Mortgage Brokers Fee's

silvercar

Ian_Griffiths_Halifax wrote: »

And how much do you think that would be and how much do you think it costs to process a mortgage if you don't work from your back bedroom?

Average FTB house price round here upwards of £200k, commission 0.3% (?) = £600.

I don't know what it costs to run an office and process a mortgage, but I reckon if there are a lot of brokers out there who only take the commission without charging extra fees then it is a model that works for many. Which implies that anyone charging an extra fee, unless they specialise in difficult to place cases, is not offering the most money saving ways to their customers.

payless

You can still offer a good service and earn a fair income without charging a fee- even at volume levels lower than Qual mentions-

obviously taking on premises & staff adds to overheads - but thats a business decision .

Qual123

Payless is totally right, If you write 1 good case a week (mortgage, CIC or income protection) you will earn ok, its taken me a long time to build my client base but it is paying me back now.

Ian_Griffiths_Halifax

Qual123 wrote: »

i work on volume, i write 3-4 mortgages a week and i've never charged a fee in my life, and i never will. Im not against fees but i do feel that if your good at what you do then the commission you earn will provide you with a very good income.

as for brokers who wouldn't get out of bed for £250 do you charge a fee because you feel the need to tie a client in? surely if you value the service you give you would earn a good income from commission alone?

If i cant place a mortgage i dont get paid, if a boker who takes a fee cant place a mortgage do they refund the fee?

I've been in the business over 18 years and was one of the first 'Mortgage Brokers'.

I have arranged in excess of 2500 mortgages in the last 12 years, which is the period over which we have been computerised in terms of client database recording.

I don't charge anything unless the mortgage completes and so there is nothing to refund if it doesn;t complete.

The average procuration fee for the mortgages I've arranged over the last 6 months is in the region of £300 as I don't deal with lenders who pay very high procuration fees, as it's usually possible to get a better deal for the clients with somebody charging a lower interest rate and paying lower procuration fees.

I have NEVER advertised that I do Adverse Credit Mortgages, Self Certification or any type of 'out of the ordinary' mortgages.

As for you never charging a fee in your life and never will, what are you going to do when the lenders stop paying procuration fees, as it will happen eventually?

Ian_Griffiths_Halifax

silvercar wrote: »

Average FTB house price round here upwards of £200k, commission 0.3% (?) = £600.

I don't know what it costs to run an office and process a mortgage, but I reckon if there are a lot of brokers out there who only take the commission without charging extra fees then it is a model that works for many. Which implies that anyone charging an extra fee, unless they specialise in difficult to place cases, is not offering the most money saving ways to their customers.

The price and the mortgage amount are 2 different things!

The average procuration fee I've received in the last 6 months has to be in the region of £300.

It depends on your location as to what the average mortgage and so, the average procuration fee will be. So for those who come on here knocking brokers who charge a fee, quite often you will find that they don't need to because they are either getting high procuration fees due to the lenders they use/d or or the average mortgage in their area.

Ian_Griffiths_Halifax

payless wrote: »

You can still offer a good service and earn a fair income without charging a fee- even at volume levels lower than Qual mentions-

obviously taking on premises & staff adds to overheads - but thats a business decision .

Spot on, but who is doing the admin while somebody who works from home is out seeing the clients? Is that offering a good service?

Ian_Griffiths_Halifax

Qual123 wrote: »

Payless is totally right, If you write 1 good case a week (mortgage, CIC or income protection) you will earn ok, its taken me a long time to build my client base but it is paying me back now.

And what if they already have adequate Life/CIC Income Protection? And what if you don't charge fees, but arrange a policy for them and they then cancel the policy and you get a clawback? We all know that the first things to go when people are hard up are insurances.

Qual123

Ian i take your point and i wasn't trying to offend you. I thinks the difference is this, my average proc fee is normally between £700-£900 this is due to location, i work in west sussex and most of my client have £200k plus mortgages, add some protection to this and you have a £2k case.

I hope you see why i feel i dont want to charge fees. like i said im not against them and like you said i may have to charge them one day. I speek to other local brokers and here who do charge fees and i just cant understand it. I always feel that they charge fees because they are not good enough to survive on commission along. This is a local issue and not directed at yourself i am just trying to qualify my comments.

Ian_Griffiths_Halifax

Jesus Christ! If I could earn that sort of money per case I'm moving down there!

I wish people would take these things into account when they are slating brokers for charging a fee. The earnings depend on the size of mortgage.

payless

We all haver own own business models - but don't think its good to knock those that are charging a reasonable fee NOR to knock the service levels of those that don't charge when we don't know anything about it .