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Belinda Luc
Commission pressures will ease over the next 12 months as brokers continue to improve the quality of their submissions, Mortgage Choice chief executive officer Michael Russell has claimed.
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Speaking at the company’s annual general meeting yesterday, Mr Russell believes that as brokers improve the quality of submissions and conversions they will lower lender origination costs and by default take any pressure off the current level of commissions.
“Improving quality [of borrower applications] will reduce lenders’ origination costs, and this will mean less pressure placed on broker commissions,” he said.
“I forecast that lenders will increasingly reward loan life in the future.
“Major lenders are keen to write business with brokers.”
Mr Russell said Homeside was an example of a lender keen to boost its presence in the third party channel, with a massive resurgence in market share over the financial year.
According to Mr Russell, Homeside’s market share jumped from 4 per cent of Mortgage Choice’s business in the 2009 financial year to a peak of 21 per cent of business in July alone.
Meanwhile ANZ and CBA held steady over the financial year each with a 20 per cent market share of business written through the franchise.
“The incredible resurgence of Homeside has reaffirmed its commitment to the third party channel,” he said.
“Homeside are clearly making a statement: they are sharp with their pricing and are for the benefit of brokers and customers.”
