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ISCOVER
Staff Reporter
AFG has become the latest company to slam the news story printed over the weekend about mortgage brokers, arguing the article was “unbalanced”.
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A story that appeared in several of the Sunday newspapers claimed mortgage brokers were “biased” and merely “salespeople” out for a buck.
While AFG was quoted in the article, AFG’s general manager, sales and operations, Mark Hewitt said “little credence was given to the points” the aggregator raised with the writer when interviewed for the story.
In a letter to the News Limited editors obtained by The Adviser, Mr Hewitt said AFG was “extremely disappointed” in the article on the mortgage broking industry.
“No credit was given as to the benefits brokers provide to consumers. For example, there is ASIC-controlled legislation in place to ensure brokers provide a loan to borrowers that is not unsuitable to the borrowers needs,” the letter read.
“Brokers must also disclose the commission they earn and the most regularly used lenders on their panel so that any potential conflict is declared.
“You did not conduct any analysis on the commissions paid by different lenders and the volume of loans they write to prove your assertion that commissions influence where brokers recommend customers place their loan.
“We suggested your journalist review our Competition Index report which provides a breakdown of the market share of each lender but it appears she has totally ignored this suggestion.
“Brokers play a vital role in promoting competition for which consumers are the ultimate beneficiary. In a country where the banking system is a virtual oligopoly, brokers play a very important role in helping the non-major owned brands and lenders without large branch networks compete and provide competitive options to the big four.
“Almost 50 per cent of home loans in Australia are transacted by mortgage brokers and the extremely one sided nature of your story paints a grossly inaccurate picture of a service that is highly valued by the public,” the letter said.
