The chief executive of the Association of Mortgage Intermediaries expects a “general upwards shift” in proc fees as a direct result of the mortgage market review.
He said: “I believe more lenders will raise their proc fees this year as they recognise the increased work being done by intermediaries to deliver the high quality of business they require.”
It is understood at least two intermediary lenders are planning to announce a rise in proc fees in the next two months.
Nationwide Building Society, Barclays, NatWest for Intermediaries, Santander for Intermediaries, Halifax for Intermediaries and Accord Mortgages all said they reviewed proc fees from time to time but had no plans to announce a change in the next few months.
A spokesman for Virgin Money said: “Virgin Money reviews its processes and procuration fees from time to time but any discussions between Virgin Money and clubs and networks are confidential.”
And a spokesman for Leeds Building Society said: “Leeds Building Society regularly checks the level of its procuration fees as part of normal practice, but has no plans to raise them at present.”
Background
Coventry Building Society raised proc fees for both directly authorised brokers and appointed representatives at the start of the year. DAs saw a nine basis-point rise, with mortgage clubs receiving 0.43 per cent gross, up from 0.34 per cent. AR proc fees also rose, but varied by network. Tougher affordability measures become mandatory under the MMR on 26 April, although many lenders are already MMR-compliant.
Adviser view
Peter Brodnicki, chief executive of Derby-based Mortgage Advice Bureau, said: “Lenders have a tap with intermediaries that they can turn on and off. With Halifax and Santander both paying proc fees based on quality, and Coventry unconditionally raising its proc fee earlier this year, I can easily see other lenders following soon. Brokers deserve to see some of the spoils if they are processing more paperwork as a result of the MMR.”
