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Credit policy procedures, servicing times and lender requirements are mortgage brokers’ biggest concerns, according to new lender research.
According to a survey of 237 brokers undertaken by MyState Bank in September 2020, three-quarters of mortgage brokers are concerned about turnaround times, while more than half (56 per cent) are concerned by varying lender requirements which are causing uncertainty in lending decisions.
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Eight in 10 brokers admitted they were concerned about the speed and frequency of change around credit policy procedure.
The research also found that brokers expect their businesses to continue to feel the effects of the COVID-19 pandemic for the near future.
Nearly a quarter (23 per cent) of surveyed brokers revealed that they expect the pandemic to continue to impact their business for the next six to 12 months, while 18 per cent of brokers expect this to be even longer, at around one to two years.
However, despite challenges caused by the COVID-19 pandemic, mounting online security fears and uncertainty around the extended best interests duty (BID) legislation, more than half of mortgage brokers were generally feeling certain about their future in the industry.
The bank also found that digitisation would continue to be an important component of the way brokers connect and operate in the future, noting that more than half of brokers have increasingly utilised their digital tools greatly in recent months.
Indeed, 64 per cent stated that their customers had reacted positively to the increasing digitisation throughout the home lending process over recent months.
However – despite this – brokers believe fully digital mortgages are still a long way off. More than a quarter of brokers (27 per cent) predict lending will be fully online in the next six to 12 months, while a further 22 per cent stating that the process will take between one to two years.
Reflecting on the findings, MyState Bank general manager, banking, Tony MacRae said: “While it’s pleasing to see more certainty return to the industry, we’re still seeing the pandemic continue to play out in broker businesses. It is hardly surprising that ongoing concerns among brokers, such as lengthy servicing times, have been exacerbated by the pandemic.
“Despite the challenges they are facing, mortgage brokers have played a very positive role in the lives of their customers over the last nine months – from helping set up deferrals to finding ways to restructure debt and lower repayments. This support has also extended to providing emotional support and reassurance for customers,” he added.
Mr MacRae said the way forward for the industry is likely to be a combination of both digital and face-to-face interaction between brokers, lenders and customers.
The evolution of the industry off the back of the COVID-19 pandemic proves familiar, as shown in May of 346 brokers showing an increase in engagement with their customers since the onset of the crisis.
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