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Clawback extension fears rise as Murphy's Law bites

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Australian Broker | 29 Mar 2012, 06:00 AM Agree 0
Brokers hit by commission clawbacks are expressing 'once bitten, twice shy' fears of potential bank extensions to clawback terms
  • Tony | 29 Mar 2012, 10:15 AM Agree 0
    there's an easy fix - use a lender/mortgage manager that does not have clawback!
  • Todd | 29 Mar 2012, 10:20 AM Agree 0
    I have received two recent claw backs from clients who have sold their properties. Now at what point is this my fault nor could I have done anything to negate this... I don't believe there should be any claw backs when selling has occurred... just another " the banks rule roost " tactic where they can get out of paying...
  • Rach | 29 Mar 2012, 10:40 AM Agree 0
    Agree Todd. If I've done something wrong, I'm happy to cop the clawback, likewise if I refinacne the deal and get paid upfront again, no problem... - but if the cusotmer simply hits rough times and there's nothing I did wrong or can do to assist... If clawbaks MUST exist, then let's at least have varying degrees dependent on reason ?
  • JBJB | 29 Mar 2012, 10:50 AM Agree 0
    The first major or second tier to introduce a no clawback policy for a sale of property will score broker support. The 2 years clawback of WBC & SG is one of the reasons to avoid them.
  • Terry | 29 Mar 2012, 11:11 AM Agree 0
    Aren't the banks allowed to charge the client for costs incurred such as broker comms In the event of a discharge. That being the case the banks should charge the client for the cost of the commission paid. Not the broker who placed the loan with them. its a user pays principle. The banks are big on that when its them thats charging the user pays fees to their advantage.
    Just my thoughts.
  • Happy broker | 29 Mar 2012, 12:16 PM Agree 0
    Completely agree with Tony. I've been using a mortgage manager where there are no clawbacks so I never have that worry. If you keep putting everything to the major banks, you're going to keep getting the bad service and your income going down.
  • Country Broker | 29 Mar 2012, 12:22 PM Agree 0
    I strongly believe the ACCC and ASIC should be looking at THIS BEHAVIOUR , The MFAA are weak on this as lenders are members as well . I believe that a claw back should only be charged if the loan is refinanced in the claw back period not due to sale of property , death of a borrower or divorce/family law matters surley claw backs are there to stop brokers churning ? If there was fee the client had to pay all good, The other suggestion is stick close to your clients . How do we overcome the suitation of the CBA charging A CLAW Back when the clients went to a branch and asked for an increase and were told by the branch staff, " we will look after this for you , the broker will still be involved , there is no need to go back to them" - out right lies . Once we challenged the claw back and got it in writing from the client the CBA reversed the claw back, how do we overcome branch staff who outright lie ? stay close the cleints.
  • Positive Broker | 29 Mar 2012, 01:53 PM Agree 0
    Clawbacks are probably a commercial reality but I can live with the Bankwest system where the clawback is pro rata based on months elapsed. If a customer leaves in month 18 the clawback is 1/18th of the commission rather than 100% or 50%. At least there is a semblance of fairness about it.
  • iMac | 29 Mar 2012, 02:42 PM Agree 0
    THE SOLUTION IS - Include a clawback clause in your broker agreement with the client. If you suffer a clawback then so do they. I've been using it since 2007. I point it out to clients, explain why i do it, and ask them to initial it. I have NEVER lost a deal because of it. I explain to them that when i do the work for them that they ask me to do, ie, get them a better deal on their loan. If they sell their property in 12 months time my FAMILY still needs to be fed. My family should not have to suffer if they sell their home. I do remind clients that if the clawback at that stage may only be seven or eight hundred dollars, and they'd be very cash-up at that stage, so they wouldn't even notice it. i've NEVER missed a deal when i bring my family into the discussion. Blame the banks. You've got the hero supporting his family, the broker - and the bad villan, the banks. Its poetry in motion, and never fails, when its done right :-)
  • Melanie Burns | 29 Mar 2012, 03:59 PM Agree 0
    "Following the GFC Banks rolled out clawback policies" ???!!?? Since the dawn of time banks have had clawback policies - this is not a new thing resulting from the GFC. This is why I do not write loans for major banks!
  • Melanie Burns | 29 Mar 2012, 04:01 PM Agree 0
    Further, I agree with iMAc - for the odd funder I deal with that has clawback, I have a clawback clause in my Credit Proposal Contract.
  • 1martym1 | 30 Mar 2012, 01:14 PM Agree 0
    i have a clause as well $550 standard charge or more if i suspect the loan will be short term. never had any resistence.
  • Broker | 30 Mar 2012, 02:42 PM Agree 0
    I have used a clawback clause in my brokers contract for well over 2 years, only ever lost one client , happilly I might add.
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