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The non-major bank has become the latest lender to announced that it will change the way it calculates upfront commissions from next year.
ING has said that, from 1 January 2019, the upfront broker commission for residential loans will be determined on total net loan balances calculated, five calendar days following settlement.
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The move comes as more and more lenders commit to the recommendations from the ASIC and Sedgwick reviews, which were backed by the Combined Industry Forum package of reforms.
Speaking of the changes, Glenn Gibson, ING’s head of third party distribution and direct mortgages said: “We have two main objectives to achieve here: the first is to clearly deliver on the industry’s reform package and the second is to keep the commission structure simple.
“To that end, we’ve taken a straightforward approach to ensure the change is easy to understand and operationalise for all parties.”
Earlier this week, MyState Bank also revealed that it would be calculating broker commissions on both new home loans and loan increases based on the drawn down balance (utilisation) from 1 January.
However, MyState’s calculations will be based on the 10th calendar day of the month (instead of the initial total approved loan amount).
The CIF recently hosted an event that further outlined its work on mortgage broking reforms and reiterated that lenders are expected to make the remuneration changes by December 2018.
Three of the big four banks (CBA, NAB and Westpac) have all announced similar changes already. ANZ is expected to follow suit imminently.
[Related: Major bank changes broker commissions]
