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Brokers potentially missing out on £35m of proc fees by sticking to top 10 lenders
Mortgage brokers could be missing out on £35.6m worth of proc fees annually because they do not use affordability calculators from a non-mainstream lender, an analysis has found.
Looking at cases processed through the Mortgage Broker Tools (MBT) platform and industry data, the firm calculated this figure based on the average mortgage loan size of £200,000 and average proc fee of 0.4 per cent.
MBT used information compiled by Trading Economics which said there were 80,000 mortgage approvals a month, with 80 per cent being processed through a broker, representing 64,000 cases.
A survey run by Mortgage Brain earlier this year suggested 58 per cent of brokers rarely used affordability calculators from a non-top 10 lender, despite MBT data showing 10 per cent of all cases would not fit with one.
As a result, MBT suggests that brokers are missing out on placing 3,712 cases a month, which equates to 44,544 cases a year through an unwillingness to investigate a broader spectrum of lenders.
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Tanya Toumadj (pictured), CEO at Mortgage Broker Tools, said: “Old habits are costing brokers money.
“We know that nearly six in 10 brokers rarely look outside of the top 10 when it comes to identifying a lender that can meet their clients’ loan size requirements, yet one in 10 cases don’t have an appropriate affordability match from the top 10 lenders.”
“These may seem like small percentages at first, but they add up to big numbers in lost revenue,” she added.