Trust in money men plummets July 28, 2009
Rob Stock reports on a SST survey of how they rated financial advisers, mortgage brokers and others for trustworthiness…. the results were, not surprisingly, not flattering for those advisers/brokers.
Fundit believes that the broker model for both mortgages and financial advice generally is deeply flawed - in particular, as they receive different commissions from different lenders/borrowers/issuers of shares securities. Any incentive for them to propose loan or investment offers other than from those who pay them the highest commission (or no commission at all, as in the case of BNZ mortgages) is largely absent. The proposed commission disclosure regime is unworkable, as it is largely impossible for users to make a practical and meaningful comparison of offers net of commission.
The Fundit model provides a level playing field for all lender participants and the same commission rates (which are substantially less than those of Brokers). It is completely open and transparent and allows users to very simply compare offers on an apples for apple basis. We say it does more for consumer protection than any form of regulation
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