From Rick GiffordLike many brokers, I question the role of mortgage clubs and only use them to obtain better proc fees – any other advantage has yet to manifest itself. I see clubs as organisations that proportionally make a great deal of money, particularly from directly authorised brokers. I could quote a number of instances of this but the most recent highlights the point perfectly. Like many brokers I have used a number of packagers over the years – they come and go as service levels fluctuate. In the past two years I have used All Types of Mortgages to good effect, and separately Mortgage Intelligence as my preferred mortgage club. I was not too happy with the processing of sub-prime cases for MI members via AToM since it complicated the processing chain. The number of cases MI had input into was minimal – fewer than 1%. And I always felt that if a lender was paying a proc fee it should be the same for everyone. So when I placed a case directly with AToM recently I was surprised that my proc fee came via MI, which had no involvement at all in what was a protracted transaction due to the complexity of the case. I had written on the application that I was a member of MI, correctly in my view. I did not put the usual MI sticker on the application, neither did I submit it with the usual MI submission sheet – the latter has to be used for MI cases. When I received my 1,600 proc fee from MI and checked against the gross fee paid to AToM I found that MI had been paid 682. For what? If the lender makes this amount available as a proc fee why should it not go directly to the broker, especially when the mortgage club has had no involvement? The above represents about 35% payment to MI for doing nothing. No wonder managing director Sally Laker is always smiling. I asked for an explanation from AToM as to why it involved MI and have been waiting for a call back for nearly three weeks. I’m sure if I had left the question blank on the application I would have had a call from AToM to ask which club I was a member of. Packagers and mortgage clubs must realise that we brokers who are dir-ectly authorisedlike it that way since we seek to be independent and have the freedom to give our clients the best advice from the whole of the market. We do not want to be controlled – and this feeling gets stronger when we see ourselves being ripped off by top-sliced proc fees. Rick Gifford the-mortgage-broker.com By email
- Top trends
More mortgage borrowers are taking out expensive adverse credit home loans when they could qualify for significantly cheaper deals, reports Moneynet.co.uk.The online financial data comparison site has seen a 20% increase in the numbers of borrowers opting to take out mortgages offered by specialist brokers dealing with the non-standard mortgage market.Richard Brown, chief executive of […]
There’s recently been a flurry of deals seeing mutuals joining forces and this looks set to continue. The transactions are normally couched as mergers but in reality the big boys are swallowing up smaller rivals. It’s debatable whether this is good for customers.
John Charcol has chosen eMoneyfacts as its mortgage sourcing system. eMoneyfacts provides brokers and intermediaries with a comprehensive and whole of market sourcing system, which means their clients can rest assured that the advice they are getting is based on the latest product information.Ray Boulger, senior technical manager at Charcol, says: I have used Moneyfacts […]
The latest buy-to-let index from specialist lender Paragon Mortgages shows a renewed pick-up in the prices at which investor landlords buy properties. Nationally, property prices rose by 1.99%, with larger rises in some regions.John Heron, managing director at Paragon Mortgages, says: Residential property investors continue to build their portfolios in a buoyant housing market. Weve […]
By Simon Halifax, senior marketing consultant For a few years now, mortgage advisers have probably been warning their clients that there’s only one direction that the interest rate is going and that’s up (well, I know mine has!). However, the financial landscape changed when the UK voted to leave the European Union last month and […]
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