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Banks give assurance over proc fee payments

Barclays and Nationwide have said they do not plan to tie the level of proc fees they pay brokerages to the quality of business they submit.

Mortgage Strategy revealed last month that a high street bank is looking to determine proc fees based on the quality of business it receives.

It is understood the lender has developed a metric to assess different elements of brokers’ business, such as the quality of cases they submit, how they interact with clients and their overall conduct.

In a panel session at the Mortgage Business Expo in Manchester last week, all five members of the panel – from Barclays, Nationwide, Platform, GE Money Home Lenders and Virgin Money – stated that they do not plan to go down this route.

Sarah Green, head of national accounts at Barclays, says: “We will not be making changes to proc fees.”

James Chidgey, senior manager of corporate accounts at Nationwide, says: “We have got no plans at all to do that.”

Lee Gladwell, director of sales and proposition at Platform, says: “As far as new ideas go, I think this is a crap one. Proc fees are a valid part of the industry. It is our job to underwrite these mortgages and I think to tie them to quality would be an administrative nightmare.”

And Richard Tugwell, intermediary business manager at Virgin, says: “Using quality to determine proc fees is a blunt tool. It is more about educating people about why the case is not of sufficient quality.”

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