The Banks and the Mortgage Brokers

Franchised mortgage brokers have seen a surge in business over the last decade. Until recently, companies like Mortgage Choice, RAMS, Wizard, and others expanded to meet the demand for credit generated by the proliferation of non-bank credit providers. There’s no denying the harsh reality of the credit crisis: it’s wreaking havoc on the non-banking market.
According to the Mortgage & Finance Association of Australia (MFAA), non-bank mortgage originators’ market share has fallen from 15% to about 4%, essentially putting an end to a pattern that started in the late 1990s. The allure of investing in a branded, non-bank franchise could be dwindling. Our website provides info on Wealthy You


Mortgage brokers often operate in what is known as a franchise environment. This is not the same as being “independent.” The mortgage brokers are subject to a number of restrictions imposed by the franchisor. Consumers trust brands, but franchisees are hampered by their inability to operate openly in their respective markets. The franchise group’s commission arrangements are always stacked in their favour, and the arrangement terms are onerous.

Leads would be given to mortgage brokers who want to buy a franchise or work in a franchise setting, according to the promises made to them. Mortgage brokers, on the other hand, rely on high-quality leads. However, the majority of the time, the accuracy of the leads is poor. They’re typically created by the internet, and when you call them back, they often have no idea why you’re calling.
Other mortgage brokers become members of “aggregator” organisations. Mortgage brokers must be “registered” by banks before making mortgage applications on behalf of clients in the current market. To gain access to banks and other lenders, independent brokers must first clear volume hurdles. These organisations handle a lot of the enforcement, technical indemnity, and training programmes, making it easier for smaller businesses to get involved.

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