Why do directly authorised firms receive significantly less on proc fees than appointed representatives? I know
all the arguments but it still doesn’t make sense to me.
Large firms like Sesame, Legal & General and Openwork command higher proc fee deals from the major lenders supposedly because of volume .But consider Premier Mortgage Services which generates a massive volume by virtue of the amount of DA firms that submit business under its banner. PMS apparently receives 0.3% from Halifax, while the other clubs mentioned enjoy 0.4%. Why? PMS apparently gets 11 per application completed but no more than that. Is this correct? Could it be that the big lenders pay a ‘marketing allowance’ to clubs for the privilege of being on their panel that we as brokers do not see any of? Is it right that this allowance is not disclosed on our KFIs? Is the FSA interested? DA firms should not be penalised. I know volume is important but we have volume. Together we generate an enormous amount of business. Why should we suffer because big businesses are doing deals behind closed doors? This is a call to arms to achieve better proc fee deals. All DA firms can apply pressure to their respective mortgage clubs to negotiate better rates for all. If we are being done down, we should do something about it. The buying power of mortgage clubs like PMS is proven but are all the benefits being passed on to brokers? I welcome ideas from fellow DA firms that may further our cause.