What you need to know about best interests duty (BID)
Your Aussie Broker will continue to look out for your best interests
When choosing a home loan, you’re likely to be making one of the biggest financial decisions in your life.
At Aussie, you can be sure that your Aussie Broker is a professional who will always put your best interests first, by presenting you with a range of options that best suit your individual needs.
What is the best interests duty?
The best interests duty (BID) is a new law that requires mortgage brokers to act in your best interests when providing credit assistance.
This means your broker should and will:
- Put your best interests above any personal benefit to them;
- Provide you with home loan options and educate you on the pros and cons of each;
- Make recommendations to you based on your personal circumstances, your requirements and objectives (now and in the future), taking into account:
- the loan features that would be beneficial to you;
- your ability to comfortably afford repayments;
- your likelihood to be approved by a lender(s); and
- the overall cost of the loan – interest rates, fees, repayments etc. – compared with alternatives.
- Not recommend a product or service of a related party that would create extra revenue for themselves, Aussie or another related party, unless doing so would also be in your best interests.
When does the best interests duty apply?
Best interests duty applies when your broker:
- suggests you apply for a particular loan with a particular lender;
- suggests you apply for an increase to a current loan you have with a particular lender;
- suggests you remain in a particular loan with a particular lender;
- helps you apply for a particular loan with a particular lender; and
- helps you apply for an increase to a current loan you have with a particular lender.
Best interests duty only applies to mortgage brokers and not banks or other non-bank lenders. So unlike when you go directly to a bank or lender, your broker is required by law to act in your best interests.
When will the best interests duty be implemented?
The best interests duty will come into effect in Australia on 1 January, 2021.
Why can you trust your Aussie Broker to put your best interests first?
At Aussie, you can always expect your Aussie Broker to act in your best interests. We have:
- nearly 30 years in the industry;
- helped more than 1.5 million customers;
- access to thousands of loans across more than 20 lenders^; and
- been formally trained on our obligations around the best interests duty.
Your Aussie Broker will consider your individual circumstances and provide you with a range of recommendations that meet your objectives, financial situation, and needs.
This information will be clearly presented to you to explain why certain recommendations have been made above other options.