Improved disclosure wins business: mortgage association
The Mortgage and Finance Association of Australia (MFAA) has told its members that mortgage brokers who provide disclosure to clients on the commissions they receive win more business than those who are less transparent.
The MFAA undertook a ‘mystery shopper’ report late last year, not unlike those undertaken in the financial services industry. The industry body said the report showed that mortgage brokers who made disclosures to clients on matters including commissions, as well as complaints and other procedures, were more successful in winning business.
MFAA chief executive Phil Naylor said the report showed that when brokers clearly disclosed commissions, the shopper’s average likelihood of borrowing with and recommending that broker was significantly higher than when commissions were not disclosed.
“As in all business, it’s clear that transparency and openness is the key to winning customers,” Naylor said.
According to the report, more than half of the brokers (57.1 per cent) disclosed their commissions or how they were paid, up from 43 per cent in January 2008.
AUTHOR
Recommended for you
Sequoia Financial Group has announced it is selling off its Informed Investor subsidiary which it acquired in April 2022.
Wealth Data has examined which advice business model has seen the most growth since the start of the year including those that offer holistic advice.
Research conducted by Elixir Consulting and Lonsec has quantified the efficiency gains of using managed accounts in financial advice practices in hours per week saved.
With only one-quarter of advice practices actively seeking feedback from clients, the Financial Advice Association Australia has emphasised why this is a critical tool for client retention.
