Santander for Intermediaries has today announced plans to pay mortgage brokers a procuration fee of 0.2 per cent on retention business.
The roll-out of payments across networks and mortgage clubs will start from March 1 and be fully in place by the start of July.
Procuration fee payments will be paid on all retention business being transacted through the online portal.
Santander managing director for intermediaries Brad Fordham says: “After a successful pilot run last year with London & Country, I am delighted to announce plans to pay procuration fees on retention business, intermediaries play a key role in what we do and we look forward to working even more closely together in 2017 and beyond.”
Association of Mortgage Intermediaries chief executive Robert Sinclair says: “I think this is the arrival of common sense and recognition that the work that is now being done by intermediaries in this area is more than just ticking a box and moving on.
“They do a reasonable amount of work to do this, and take advice risk around it, and it’s appropriate that there is some compensation for doing that.
“I think this will apply more pressure to the rest of the market. While one of the big two wasn’t paying these, then it gives room for others to adopt the line they are adopting. I think Santander stepping across the line here will make life more difficult for others.”
Coreco director Andrew Montlake adds: “It’s positive to see Santander’s commitment to the intermediary market.
“The move to paying procuration fees demonstrates the importance the team places on the work brokers do and will help to strengthen the relationship between brokers and the Santander team.”
Of the top ten largest lenders by CML data, Nationwide, RBS, HSBC and Coventry Building Society still do not pay retention proc fees.
Lloyds, Barclays, Cambridge Building Society and Clydesdale already pay some form of proc fee for retention business. However, Lloyds is the only lender that pays a full proc fee.
Yorkshire and Skipton building societies are running a pilot proc fee scheme. Yorkshire used to pay retention fees until 2009. It launched a pilot to restart paying fees on retention last April.
Virgin Money introduced a proc fee for retention business last July.