More financial planning groups will set up joint venture arrangements with mortgage brokers in the future, but remuneration models are yet to be defined, according to a broking executive.
Speaking to ifa, National Mortgage Brokers (nMB) managing director Gerald Foley said convergence between financial planners and mortgage brokers is on the rise.
“I think it will be an arrangement where there could be a joint venture between a financial planner business and a mortgage broker who will form a vehicle but will be a dedicated broker within that group, rather than referring outside on a commission sharing arrangement,” he said.
However, Mr Foley noted he has seen evidence of financial planning businesses wishing to take ownership of mortgage broking services.
“We are seeing some interest now from a number of financial planning businesses who are saying ‘we would like to set up and own the mortgage business and we will source or help them source a suitable person who will be the loan writer within that business’,” he said.
“It’s too early for me to say whether it will be one or the other. I think it just comes down to there will be a number of similar but slightly different models running around.”
Mr Foley’s comments come after nMB announced its ‘New to Industry Broker Support’ program in January which targets financial planning businesses looking to add broking to their service suite.
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