Buyers demanding mortgage broker fee breakdowns after BBC probe

Almost 100% of mortgage borrowers say they are not clear what fees they are paying, new research by a major brokerage reveals.

The news comes just a few weeks after agent conditional selling hit the headlines again when Panorama TV researchers discovered the practice in a branch of Connells.

Under pressure

Now, Gerard Boon, MD at Boon Brokers (main picture), says public trust in mortgage brokers is under pressure as the new study shows many borrowers do not fully understand how broker fees and commissions are structured or communicated.

The latest research from Boon Brokers reveals a clear demand for client fees and commission explanations that go beyond Financial Conduct Authority (FCA) requirements.

Consumers are calling for clear, jargon-free guidance they can actually understand.”

“Consumers are calling for clear, jargon-free guidance they can actually understand,” he says.

Boon Brokers surveyed 1,000 recent borrowers across England and key findings include:

• 96% of respondents want brokers to provide both written and verbal explanations of commission and fees before an application
• 87% of respondents say transparency strongly influenced their trust in broker
• 85% of respondents do not believe brokers should charge both a client fee and receive commission
• 67% of respondents did not receive a full written breakdown of commission earned
• 66% of respondents stated that they did not have a full understanding of both broker commission and fees
• 25% of respondents said client fees and commission were mentioned only briefly or not at all

Undercover

Last month, an undercover Panorama reporter working as a negotiator at Connells in Abingdon, Oxfordshire, revealed evidence, including recorded phone calls, that the company’s employees were involved in conditional selling.

A senior branch manager was shown favouring prospective buyers, if they were planning to take out Connells in-house services, like conveyancing or mortgages, because it made more money for the company.

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Author: Gemma