Speaking to ifa yesterday, NAB executive general manager for wealth advice Greg Miller said the group had used its national adviser roadshow recently to help advisers understand the opportunity in servicing next generation clients.
As part of this, NAB has encouraged its advisers to start having lending discussions.
“What we are looking for advisers to do, and we’re doing a fair bit of this today, is how it is that you get involved in the lending discussion with clients about their homes and about their investment properties,” Mr Miller said.
“We think that’s really important. We think financial planners [can work out] not just what a client can borrow but what they should borrow in relation to their overall asset base.
“So we think advisers can add a lot of value in the lending discussion. We’re encouraging a lot of our advisers to be involved in mortgage broking as part of their operations.”
Mr Miller believes offering mortgage broking services is one way advisers can tap into the next generation’s wealth, which is starting to grow.
“Generation X is not quite the same as Baby Boomers. Those 35- to late 40-year-olds have quite a few years of accumulation still to go and they are really a growing opportunity for advisers to focus on,” he said.
“One of their major issues is home loans and affordable housing and now we’re going into investment properties. If that’s a key part of those people’s lives then advisers need to play a part of that.”
Mr Miller’s comments come after ASIC announced it found conflicts of interests in the way mortgage brokers receive commissions.
Earlier this month, the corporate regulator said a broker could recommend a loan that is larger than the consumer needs or can afford to maximise their commission payment.
It found that both lenders and brokers do not make sufficient inquiries into consumers’ expenses.
INTERESTING !!! Right now the NAB and other bank lenders are attempting to squeeze commissions for mortgage brokers on loans sourced from banks. Perhaps NAB thinks they can now sucker in mug financial advisers to work for nothing, thus allowing them to reduce commissions to mortgage brokers while getting the same amount of loan business, across all sources !
Might be attractive to the “holistic” advisers, but I cannot imagine too many riskies joining up if they think it through, particularly what happens to trails if the lender/insurer suspends the adviser. I hear the take up of advisers to sell loans through a broker licencing facility provided by some licencees is very low.
And then there’s ASIC renewed interest in mortgage brokers. Any audit of the advisers financial advice file will now include the audit of the loan file, multiplying compliance. “Too much insurance, too large a loan ”
Good old self-interest – the only horse in the race that’s trying !!
Greg Miller, EGM Wealth Advice NAB LinkedIn profile viewed at 11:15am AEST today shows NO Financial Planning qualifications. I also cannot find a ASIC FAR listing.
He’s an ideas man
You clearly don’t know the man.
Also, NO Mortgage Broking qualifications on the LinkedIn profile either Danielle!
Newsflash ASIC. Doctors can recommend treatment procedures that are more extensive than the patient needs, to maximise their revenue. Lawyers can draft contracts that are more complex than the client needs, to maximise their revenue. Accountants can recommend a super fund which is more complex than the client needs, to maximise their revenue.
When oh when will people wake up to the fact that all forms of remuneration are conflicted. Controlling the way a service provider is paid does not solve that problem. It can only be solved by making sure the service provider puts the client’s interests first. This is now regulated for financial planners with FOFA and BID. It has recently been regulated for accountants in relation to SMSFs. Hopefully something similar will be brought in for mortgage brokers. But removing commissions is not the solution and never has been. In many cases it just leaves the client worse off, as it makes valuable advice and service less accessible to them.
It is …. Its called National Consumer Credit Protection Act ….. Incredible
Percy, the NCCP for mortgage brokers is like FSR for financial planners. It’s stronger than what was there before, but still doesn’t provide adequate consumer protection. Mortgage brokers will be better served by quickly strengthening NCCP, before the morons at Choice get their way and try to solve the problem by banning commissions. Otherwise everyone (including consumers) will be much worse off.