Hasluck’s mortgage brokers will be stronger under a Liberal National government, as the Coalition has decided to not prohibit trail commissions paid to mortgage brokers on new loans.
Instead, the operation of trail commissions will be reviewed in three years by the Council of Financial Regulators and the Australian Competition and Consumer Commission.
The review will follow the introduction of a number of new measures that the Government has already announced in response to the Royal Commission, including the introduction of the best interests duty, a ban on campaign and volume-based commissions and a two year limit on claw-back.
The review will also consider the continuation of upfront commissions which has already been announced.
The Government’s decision follows consultation with the mortgage broking industry and smaller lenders.
“There are a large number of mortgage brokers in Hasluck – many of which are small businesses, employing local people. The Government wants to see more mortgage brokers – not less,” Mr Wyatt said.
“Mortgage brokers are critically important for competition in the mortgage market,” Mr Wyatt said.
“Almost 60 per cent of all residential mortgages are settled by mortgage brokers who help ensure that consumers get a better deal.”
“Only the Government can be trusted to protect the mortgage broking sector and ensure that competition is strengthened so consumers get a better deal.”
“Restoring trust in Australia’s financial system is part of our plan for a stronger economy.
“In contrast, Labor’s policy to abandon trail commissions and propose a higher upfront fee will hurt competition, consumer outcomes and mortgage brokers,” Mr Wyatt said.