Best Interest Duty is a statutory obligation for mortgage brokers to act in the best interest of consumers, and to prioritise consumers' interest when providing credit assistance.
Best Interest Duty impacts the following processes used by mortgage brokers during the lending journey:
- Gathering information about the consumer. Mortgage brokers should gather relevant information to ensure they can provide recommendations that will be in the consumer's best interests.
- Assessing what is in the consumer's best interests. Mortgage brokers should consider products holistically to assess whether they are in the consumer's best interests. The factors and their relative importance will depend on the consumers' situation. Factors considered may include interest rate, fees and charges, or loan features.
- Presenting information and recommendations. Mortgage brokers should provide guidance and, where necessary, tailor how they present product options and recommendations to account for the consumer's knowledge, expectations and circumstances.