About Lender/Mortgage Broker Commissions
While brokers don’t admit it in plain English, lender paid commissions are BIG money that are used to sway lender selection. Although banks and brokers only ever emphasise the smallest part of commission (Upfront), it’s far from the end of the story.
For example one big 4 bank pays $16,663, while another big 4 bank pays almost 68% more at $27,893 for the same $500,000 loan; repaid over 30 years with a rate of 4% (the higher the rate, the higher the commissions).
We Pay ALL Lender Paid Money to You
When we arrange your loan with a panel lender, we pay you all the money that we receive from your lender for your loan including:
- Once off Upfront Commission (up to 0.70%) after your loan settles; then
- Monthly Trail Commission (up to 0.3% p.a); and
- Sometimes bonus payments (which may be pooled with other loans).
We do this to get rid of commission bias from not just our advice, but our whole business. This is just one of four steps we take to provide you an independent service; and as our simple, fixed fees are a fraction of total lender payments, you wind up with big commission savings too.
On the other hand, mortgage brokers pay you none or only some of the money that lenders pay them so you don’t reap the full benefit of cash-backs; and worse, there will likely still be kick-backs that mean your broker or their boss makes more depending on lender.
We Never Split Lender Payments With Anyone Else
When we declare commission rates or estimate the amount, it is 100% of the money that the lender pays when a loan is arranged with them.
On the other hand, mortgage brokers who pay you commissions may split them with others, before paying you. This is a way to hide at least one benefit they get from lenders.
Our Cash-backs Are Yours To Keep
We will never ask you to pay back any of the money we pay to you.
We also don’t have any hefty fees, like early pay out fees or ‘clawback’ hidden in the fine print.
In fact, our clear and simple fixed fees on our fees page are all we need to give you leading client satisfaction.
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