Mortgage broker cashback.

Discussion in 'Loans & Mortgage Brokers' started by PhilGood, 20th Feb, 2019.

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  1. PhilGood

    PhilGood Member

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    I am new to this forum. Looks like a buzzing place with lots of industry experts offering great advises.

    I have two loans that I would like to refinance (total $2.6m) for better interest. I already know the bank I would like to apply to. I am looking for a broker to do the paperwork.

    The broker I know is offering my only 15% of his commission as a cash back. However I am not sure what is standard.

    He says in past the cash back used to be higher but nowadays the standard is around 15%.

    My work colleague says he got 40% cashback from his broker some 2 years ago.

    Pls PM me if you know anyone who can do better than 15%.
     
  2. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    It sounds like you want an order-taker, rather than any advice and a cash-back broker may suit you fine if it's only to literally submit the paperwork for you.

    But if you've got significant loans, and are looking to build a portfolio I'd suggest that there are things you don't know you don't know, and you may benefit from a broker that will advise you and value their knowledge enough to not feel the need to give you any cash back.

    They will save you way more over the course than 15% cash back.

    Some lenders are giving cashback though for refinances, for eg, and some are for purchases - this is a set amount though, not a percentage. This get paid directly to the client and this is also available through brokers.
     
  3. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    The last time you attended a job interview, did the interviewer suggest that you'd get the job if you given them a percentage of your income? Good brokers don't offer cash backs or rebates. Long hard experience has taught me not to deal with people who even ask.

    It doesn't matter how big the commission is, you'll probably refinance again in 12 months for another 0.1% rate difference. The broker will get a clawback on their commission and the money they've given you will just be an additional kick in the head.
     
  4. MC1

    MC1 Well-Known Member

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    You are lucky he is giving you 15%
    I'd give you 0%

    Surely this is a troll
     
  5. Terry_w

    Terry_w Well-Known Member Business Member

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    I'd charge you $660 and keep all the commissions.
     
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  6. MC1

    MC1 Well-Known Member

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    Haha!!!
     
  7. Simon Moore

    Simon Moore Residential & Commercial Mortgage Broker Business Member

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    [​IMG]
     
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  8. Paul@PFI

    [email protected] Tax Accounting + SMSF Business Plus Member

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    I had a taxpayer want me to do his return for free but he said I could have x% of the refund if I could increase it. My reply cant be posted.

    I think someone has no idea about the role of brokers and the benefits they can produce.
    Come on....Is Philgoods real name Kenneth Hayne ?
     
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  9. Marty McDonald

    Marty McDonald Mortgage broker Business Member

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    [​IMG]
     
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  10. PhilGood

    PhilGood Member

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    I am sorry if I upset some of you. Looks like not all brokers offer cashback which is understandable. Not all businesses offer discounts but some do in order to stay competitive and that is how a free market balances itself.

    0.5% commission (not including trailing commission) on $2.6m loan translates to $13,000 upfront.

    I have all my paperwork ready to be lodged to bank. I can do it myself but I don't have any incentive to go bank directly.

    If I do it via a broker we get $13k upfront which we can divide among ourselves. It's a win-win.

    I understand broker has to invest few hours of his/her time because once a broker is involved I can't talk to bank directly. All my communications go via broker. It's an overhead which I am willing to trade in with cashback.

    The bank in question has no clawback.
     
  11. Terry_w

    Terry_w Well-Known Member Business Member

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    Latrobe?

    Why use them?
     
  12. Paul@PFI

    [email protected] Tax Accounting + SMSF Business Plus Member

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    Ironic - Broker may create a breach of best interest test if the lender choice is based upon the cashback. All their loans are with lenders with no claw back ? And thats how its marketed to clients ?

    What stops them churning at the client request ? Its brokers like that who really do need to be driven out. If a financial adviser did this they should lose their AFSL.

    A few hours of their time ?? Im not a broker but that seems wrong.
     
    Last edited: 20th Feb, 2019
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  13. PhilGood

    PhilGood Member

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    No.

    Please PM me your %age cashback offer. We can discuss the details.
     
  14. Terry_w

    Terry_w Well-Known Member Business Member

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    No thanks
     
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  15. MC1

    MC1 Well-Known Member

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    I'm happy to go 50/50 lets discuss troll
     
  16. Vassago

    Vassago Well-Known Member

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  17. MC1

    MC1 Well-Known Member

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  18. bunkai

    bunkai Well-Known Member

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    Seems fair enough to me! Cash back mortgage looks good.
     
  19. Vassago

    Vassago Well-Known Member

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    A mortgage broker can't provide financial advice unless they have appropriate AFSL licensing
     
  20. MC1

    MC1 Well-Known Member

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    Ok, I'll rephrase. Did your mortgage broker facilitate a fixed rate loan through the lender on your behalf?