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Fee-for-service, planning, present opportunities for brokers

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Australian Broker | 07 Feb 2014, 08:00 AM Agree 0
Brokers should take another look at convergence and charging fee for service as a way to boost business and expand client relationships, says one industry leader.
  • M C C | 07 Feb 2014, 09:24 AM Agree 0
    Fee for service works very well for our business which is an integrated broker , accounting , planning group. The finance broking fee for us is relatively small, but our client base recognize our value proposition - we are a professional industry with what is now a well established licencing & accreditation process - fee for service is in recognition of that.
  • John Smith | 07 Feb 2014, 09:43 AM Agree 0
    Unless its compulsory for all brokers, then many will not do it. I also explored fees for extra service, but as soon as you mention it some clients disappear. Yes some of you may claim, that maybe I am not offering the service, but that's not true, and have many clients based on reputation and service. So-
    * It has to be compulsory.
    * It has to be across the board, and include bank staff.
    Until then I will continue to give that service away for free, and keep the ongoing business. I don't care if you think I am naive, as I am not.
    MCC is correct, and it would work as part of a larger integrated business.
  • Country Broker | 07 Feb 2014, 09:43 AM Agree 0
    I find these comments concerning about integrating businesses. We have seen a major integrated SA business go into liquidation with high debt levels . Mortgage Broking businesses clients need certainty about the business they deal with being stable and having a certain future .
  • M C C | 07 Feb 2014, 09:50 AM Agree 0
    Country broker. In our operation there are no referral fees paid between the three business arms. They operate as separate entities but under the one overarching business banner. Each separate arm is accredited & licenced accordingly & each arm does not offer advice in the other 'spaces'. We are very mindful of transparency & removing the 'chinese walls' perception. I also receive referrals as an example, from other accounting practices even though they know we have accounting internally within our business - what does that say about our integrity? Anyway I'm off track - sorry.
  • Peter Fast | 07 Feb 2014, 10:31 AM Agree 0
    The conversation around fee for service will never "slip off the radar". Someone has put it in their diary for regular reviews but they need to delete the entry because it is not going anywhere. Perhaps those pushing for it should advertise it loud and clear with their prospective clients - "we charge af fee for mortgage services" - and report back on how well that model works.

    On the other hand captive clients referred internally to a broker in an accounting practice (that is another practice employee) cop the fee but would not be happy about it. If you are not sure - ask them if they like paying fees. The sheep are often just too polite to complain.

  • Bettina Westaway | 07 Feb 2014, 12:22 PM Agree 0
    Bank Staff would need to start charging the fee first and then the rest of the broking industry will follow suit. Its a hard call, look at how unsuccessful it was to charge the AMP pre approval fee, very high income public servants would become very indignant whenever the fee was mentioned so in the end I would just not go there.
  • Papery | 07 Feb 2014, 12:36 PM Agree 0
    Back in the olden days when I was a Bank Lender, I remember the upfront Establishment fee being collected at approval & before the approval letter was issued.
    Then Mortgage Brokers became quite active with Aussie, Rams & Wizard & the upfront Estab fee disappeared all together with the proliferation of competition by Brokers & other Lenders which started popping up onto the scene..
    Competition is meant to drive costs down for the customer.

    I strongly agree with Fee for Service & it should start with a minimum fee across the Board for a level playing field with the service provided able to exercise discretion to charge higher as they see fit.
    Our industry bodies need to do more to educate Joe Public as to the value of the service (they currently get for free).
  • SA Broker | 07 Feb 2014, 12:38 PM Agree 0
    I cant see why this issue keeps coming up.
    If people want to charge a fee, let them.
    The masses don't charge, and my business takes plenty of business off Companies who do charge.
    We choose to specialize in lending only and there is no need to charge a fee.
    Why Banks even have an opinion on this subject is odd.
  • Broker | 07 Feb 2014, 01:01 PM Agree 0
    No Banks - this is not and should not be your area of concern, so please look after your business and we will look after ours!
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