Banks' RBA Break to Drive Broker Business
A wave of borrowers could be seeking out brokers should the banks choose to sit on their hands after any RBA rate cuts.
MFAA chief executive Phil Naylor has predicted that inaction by the banks could see "the gauntlet thrown down" to borrowers, and may motivate them to ditch their lenders in favour of a better deal.
"2012 will see a more challenging economic environment and coupled with a change in lenders’ behaviour, the onus will be on borrowers to seek out a better deal for themselves through an MFAA approved broker," he said.
Naylor pointed to statements from Australia's banks that they will not move "in lock step" with the RBA, and said this could see more borrowers doing it tough.
"As a result the drop may not be passed in a timely fashion or not at all to borrowers, who will then be faced with the challenge of continuing to meet their current interest payments without any respite. This will please neither the Reserve Bank nor the Federal Government, which will put pressure on lenders to pass on the rate cut," Naylor predicted.