A State Comptroller report published today gives formal backing to the push to regulate Israel’s mortgage advisory market, which has been moving toward legislation over the past year. The report says about 60% of mortgage borrowers in Israel now use a mortgage adviser, yet the profession still operates without licensing, a dedicated regulator, or an organized supervisory framework.
The comptroller warns that the lack of regulation exposes borrowers to risks, and highlights potential conflicts of interest created by compensation models in which advisers are paid by financing entities. That issue has recently also surfaced in the Capital Market, Insurance and Savings Authority’s decision to ban commissions to advisers from non-bank financing bodies.
The findings are not new, the article says, and largely reflect concerns the Mortgage Advisers Association has been raising for years in repeated appeals to regulators and lawmakers. The association argues that a profession involved in one of the biggest financial decisions in an Israeli family’s life needs clear standards, binding ethics rules, and effective oversight.
The main solution is already advancing. The Knesset Economic Affairs Committee has approved the Mortgage Advisory Industry Regulation Bill for first reading, and it would introduce mandatory state licensing, a registry of mortgage advisers, uniform professional entry requirements, and a total ban on receiving compensation from financial bodies. If enacted, the adviser would owe allegiance only to the borrower. The article says the report should be seen as another step toward a near-complete regulatory fix and as evidence of the association’s decade-long campaign.
