Trail commissions being withheld
Mortgage brokers may be suffering a further blow to their incomes as a result of problems in the economy.
Monday, September 22nd 2008, 5:52AM
by Maria Scott
“Non-payment to us means of course that we are unable to on-pay brokers whilst the loan is in arrears. This has caused some confusion with brokers who have been used to in the past receiving payments,” United said in a recent circular to brokers.
The company said that a significant number of loans were currently in arrears. “Our recoveries team are working hard to manage delinquent loans and bring them back into line. This is a frustrating and difficult task as you can imagine.”
United says that once a loan is returned to order, trail payments resume.
A reduction in trail commissions due to rising arrears will come as a further blow to brokers after cuts in upfront commissions by major lenders last year and the general downturn in the lending market.
United business development manager Riki Plester says because brokers’ volumes are down, trail becomes more important to their success.
He said that brokers maintained relationships with clients and it was in their interests to be in touch with them to try to resolve arrears problems.
United was sold by the Hanover group last year to the Lombard financial services group whose Lombard Finance subsidiary went into receivership in April. United is owned by the Lombard parent group which is not in receivership.
Plester says it is “business as usual” for United and that despite the tight conditions in the lending market there were still funders willing to provide competitive finance, including 100% loans and loans for clients who did not wish to declare their incomes but had substantial equity in their properties.
| « Keep fixing short and sweet | OCR cut to 7.5% » |
Special Offers
Commenting is closed
|
|
Printable version |
|
Email to a friend |
