As a previous participant within the mortgage broking industry, it would have been a prime time for the industry currently, due to Labor’s salvation of valuable trailing commissions that were discussed to be banned under Labor government rule, Being revoked for the successful re-election of Coalition.
For this particular occasion, said to be extremely favourable for the whole Mortgage brokering industry as the distribution is extremely relieved that the Hayne royal commission recommendations will not be adopted when it comes to remuneration for the brokers. Voters were warned about the risks of Labor’s negative gearing changes as well.
Industry spokesperson Katrina Rowlands said the Labor had underestimated the strength of the broker community. Ms Rowlands raised a campaign against the adjustments and specified the election results as great outcome for the industry and the clients.
How the Coalition is going to conduct the is that the liberals have chosen not to proceed with the recommendation from the Hayne royal commission to scrap trailing commission and stop the banks institution paying upfront commissions, Instead choosing to review the policy in 3 years’ time.
Under the Labor government proposal trailing commissions were set to be banned from 1st July, 2020. Labor did plan to cap upfront commissions paid by the banks at 1.1 percent of the total loan amount drawn out by the borrower.
Since the proposal was announced the mortgage broking industry was condemned to be unworkable, with many predicting massive job losses in the sector would follow. The mortgage broking sector rallied hard at the open, there for the gains became more muted during the day.
With some industry giants stock shares witnessing some substantial growth, Mortgage Choice shares closed 14.5 percent high, Yellow Brick Road shares closed at 7.8 percent and Australian finance group closed at 6.7 percent higher, all due to the continuation of the Coalition re-election.
As part of being a mortgage broker it is essential for brokers to work hard to provide the best deal to their clients and since the royal commission began in February 2018, it is said that the workload has increased to four-folds of extra commitments to their occupation.
Mortgage and Finance Association of Australia CEO Mike Felton said the industry had much to do with not being able to withstand the stunning results. He stated that the industry would not rest and need to reform and evolve to meet customer expectations around education and transparency.
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