Fee-for-service brokerage on its way
High quality mortgage brokers will start moving towards a fee-for-service business model this year as a way of distinguishing their level of service and to escape from the onerous commission structures imposed on them by lenders over the past couple of years. Speakers at yesterday's Mortgage Processing Conference in Sydney agreed that fee for service was a viable option for brokers at the high end of the market. Mortgage Ezy chief executive Gary Driscoll said such a move would force brokers to improve their service standards. Driscoll said: "There is still some rubbish out there. We need to get rid of that bottom level." Suncorp's executive manager for mortgage lending services, Stuart Nielsen, said brokers were interested in exploring alternatives to the very tight commission regime they have been working under for the past couple of years. Nielsen said: "No one likes to take a pay cut and brokers are no different." At least one broker, Bernie Lewis in Adelaide, is said to be preparing for a move to fee-for-service in the first half of this year.