Brokers can’t be planners, says aggregator

There is ‘no way’ that a mortgage broker can also be a financial planner, according to the head of a national mortgage aggregator and financial planning dealer group.

Speaking to Mortgage Business, Astute Financial director Brad Wood said that while his multi-service company provides both mortgage broking and financial advice, both businesses operate independently.

“They have their own management structures and they have their own cost centres,” Mr Wood said.

“What we are looking to create is the opportunity for clients to have a one-stop shop where they can come in and talk about their mortgage with a professional mortgage broker,” he said.

“They can talk about their requirements in equipment finance or commercial lending with an experienced and qualified equipment finance or commercial lending broker.

“If they want to talk about insurance or wealth creation, those are completely separate disciplines that require different skill sets and different training and understanding.”

Mr Wood has been quick to point out that Astute is not a business where customers visit a broker who can also provide them with insurance and wealth advice.

“I don’t think you can be an expert in everything,” he said.

“You need to specialise in a certain area but then have access and availability to refer to other professionals in other disciplines to make sure your clients are getting the same level of professionalism that you are providing in your discipline.”

The convergence of financial services has divided the industry, with some diversified operators claiming brokers can become financial planners, while others, like Mr Wood, argue the two professions must remain separate under one roof.

Yellow Brick Road chief executive Matt Lawler told Mortgage Business last month that mortgage broking is a ‘sub-segment’ of financial planning, sparking a reaction from a national brokerage.

Mortgage Choice chief executive Michael Russell dismissed the idea.

Responding to Mr Lawler’s claims, Mr Russell said brokers should not fall victim to being a ‘jack of all trades’.

“There is no way that someone who specialises in mortgages with all the requirements and regulations that you need to be across has got the same amount of time to devote to a discipline like planning,” Astute’s Mr Wood said.

“How can you do both to the best of your ability? It doesn’t work.”

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