Broker survey results
Good Returns conducted a survey of mortgage brokers to find out their reaction to proposals by the ANZ to cut upfront commissions.
Friday, May 11th 2007, 10:19AM
Of the brokers who responded 87% were members of the New Zealand Mortgage Brokers.
Of all the brokers surveyed 72% of the business they wrote went to the banks and the balance to non-bank lenders.
The most popular non-bank lender, by a good margin was Sovereign. The next most popular lenders were Pioneer, GE Money, PropertyfinanceSecurities, NZ Finance, Bluestone and Liberty.
Clearly brokers intend voting with their feet if the proposed commission cuts go ahead.
Our survey showed that 93% of brokers would reduce the amount of business given to banks by up to 64% if the banks reduce their commission levels.
Perhaps one of the most interesting numbers was the number of brokers who would consider leaving the industry. 59% of brokers surveyed would not leave the industry if bank commission were cut, which suggests that more than a third would leave. If this happened that would most likely play into the banks’ hand as the overall broker market share would decrease significantly.
Also brokers think the bank’s attitude to doing “deals” to pick up business would change. Currently there is much discussion within mortgage broking circles about how “generous” the banks are to get business.
Fifty nine percent of brokers surveyed think that banks will be less willing to negotiate once broker commissions are cut.
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