Australian regulation model mooted
New Zealand could benefit from having an organisation similar to the Mortgage Industry Association of Australasia (AIAA), says Auckland lawyer Jonathan Flaws.
Wednesday, August 29th 2001, 8:23AM
The AIAA (which recently changed the last word of its name from Australia) was established as a self-regulatory body.
Flaws stresses that he isn’t promoting the idea as an alternative to the existing Mortgage Brokers Association (MBA).
``It would be quite inappropriate to have several competing interest groups. There has to be one cohesive group. That’s what the mortgage brokers would want and that’s what the banks would want,’’ Flaws says.
He envisages an organisation embracing all participants in the industry including banks, non-bank lenders, lawyers, accountants and valuers as well as mortgage brokers. How a New Zealand version of the AIAA would sit with the MBA is a key issue, Flaws says.
``It’s not going to be achieved at the expense of the MBA. (MBA chairman) Rob Tucker has done a superb job to date. It’s a matter of strengthening that. In many respects, it would be the industry getting behind the brokers.’’
About half of New Zealand’s mortgage brokers, who now account for about 25% of new mortgages, belong to the MBA.
Within the next month he will be coordinating at meeting of all interested parties, including the MBA, to discuss the idea. The idea initially arose from the recent MIAA conference in Adelaide which Flaws and a number of other New Zealanders attended.
He is involved in the industry through doing work for non-bank mortgage lenders.
``It’s important to help me to do my job that there’s a high degree of professionalism in the broking industry,’’ he says. In his experience, there’s ``a huge variety’’ in the quality of brokers and the public doesn’t have any way of differentiating between them.
Flaws doesn’t favour formal regulation which he says has a tendency to become out of date. ``One of the problems with formal regulation, particularly in an industry like this, is that it takes a snap shot of the industry as it is today. The industry is developing very quickly,’’ Flaws says. ``It’s much better to have regulation self-imposed by the people involved in the industry.’’
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