Ok This Is Not Funny Anymore

sarkin

Edeus warns of dramatic proc fee shortfall

The current liquidity crisis could result in as much as £625m being wiped off the total income potential for advisers, according to Alan Cleary, managing director of Edeus.
Through a recent research initiative which assessed various lender and product withdrawals across the sector, Edeus has calculated a 30% deficit in the amount of finance expected to be available to mortgage borrowers in 2008.

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I already charge a broker fee, but looks like I will have to up my fees to cover the lossed revenue

dunstonh

I was at a meeting today and there was talk of the network I am with obtaining guarantees that proc fees will be paid even if the firms do go under. You may wish to check with your network to see what they have arranged in these circumstances.

sarkin

good idea, i think some networks will strugle if proc fees slide

homer_j_3

my network has guaranteed their proc fees having listened to the recorded message whilst on hold today.

Dan_Collins_2

we are ok, for the minute!! Although I am thinking of starting to charge or finding a new career!!

Thanks for nothing FSA, NR, most lenders and the idiot yanks!!

People lives are being ruined, being made redundant while the big wigs still make a nice profit!

silvercar

sarkin wrote:

I already charge a broker fee, but looks like I will have to up my fees to cover the lossed revenue

supply and demand: if you increase your fees, won't your customers (whats left out there) will go elsewhere.

PasturesNew

sarkin wrote: »

looks like I will have to up my fees to cover the lossed revenue

That isn't how business works.

Take a steak restaurant with running costs of £100/day.
After Day 1 they've had 3 customers in buying a steak at £12.
So, day 2 they increase the cost of the steaks to £33.33

How many come in on day 2?

They should be dropping the steaks to £5 and working out how to effectively upsell and cross sell. Get a couple of JVs going.

Dan_Collins_2

PasturesNew wrote: »

That isn't how business works.

Take a steak restaurant with running costs of £100/day.
After Day 1 they've had 3 customers in buying a steak at £12.
So, day 2 they increase the cost of the steaks to £33.33

How many come in on day 2?

They should be dropping the steaks to £5 and working out how to effectively upsell and cross sell. Get a couple of JVs going.

Get your point, but lack of business is not the only reason fees could go up.

If the steak cost more to buy because the farmers had less cows and it was harder work to get a good bit of meat then they would go up!

Mortgages are getting harder to place as well as being less people buying etc. So to cover the extra work fees may go up.

I am non fee charging, but I may have to change to make a living, not just a healthy profit!

minimike2

In the last couple of weeks two brokers and one IFA in my town have had For Sale / Lease boards go up above thier doors.

I am actually quite busy and doing well this year - although I work from home, so no overheads other than I.T rental / phone etc.

I think its just thinking about different ways of working to overcome the problems. My view is that more and more people will need to use a broker now, so really business levels should increase, despite some people now becoming un-mortgageable. As long as you look at lead generation from companies that refund non-dealable clients then theres not an awful lot of loss - just petrol / hour or so time and the dealable should outweigh the non-dealable if you use a half decent lead gen company.

homer_j_3

The fact remains that its all about supply and demand. I charge a refundable research fee to ensure I do not get quote engine lemmings or my time wasted.

I offer enough choice and will morally do the right thing every time. I do not need other local brokers trying to sway my clients to their way of thinking.

Charge a fee up front and refund on completion or where you cannot get them a mortgage.

ixwood

I do feel a bit sorry for you guys at the minute, but I'd have to say i'd never pay a broker. Though this is MSE.com and we're probably not the typical borrower.