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Mortgage Broker News | 01 Feb 2016, 05:00 AM Agree 0
Despite the controversy, many brokers say they’d consider charging a fee to clients dropping out of a deal at the last minute
  • Bob | 01 Feb 2016, 10:48 AM Agree 0
    Here's an idea, if brokers want to be compensated for cancelled deals, how about banks/Financial institutions charge brokers for the deals that they don't fund and move to another lender?
    as the saying goes "what's good for the goose, is good for the gander"
  • Broker | 01 Feb 2016, 11:19 AM Agree 0
    MBABC is absolutely right to fight for the right to charge cancellation fees. FICOM is standing in the way of contract law for no good reason. Consumers sometimes get better deals with cancellation fee brokers. An informed consumer has the right to make that choice and not have the province make it for them.
  • Walid Hammami | 01 Feb 2016, 01:19 PM Agree 0
    Imagine a prospect that shops around and calls you on week ends and nights (because they work during the day) you give him all the best advise in the world you can afford. this prospect takes most of your time and detracts you from certain activities that you could benefit your business and health from (like business development activities, going to the gym etc...) He calls you after you got his deal approved and thanks you for you efforts but unfortunately he had to got with another broker/bank because they gave him a 50$ gift card with the same rate. Til next time buddy.

    Multiply that by another 30-40 prospects. And tell me how you feel about charging a penalty.

    After a few clients like that the broker will have a bad taste in his mouth. And will not act to his best when he meets a client, because he is fearful of the outcome. But once he knows he is protected, he will do all his best and will definitely help better his clients.

    You cannot take from the equation human nature. Believe me. The consumer is better served with cancellation fees.
  • Mike | 01 Feb 2016, 01:33 PM Agree 0
    Cancellation fees have to be disclosed properly and from what I see they are on a complicated form and consumers don't really know what they are signing. Plus if you are going to charge cancellation fee websites and advertising should not say your services are free. Be up front tell the client you are binding him in to this contract with a cancellation fee because you are lousy at doing your job and there is a good chance that someone will beat my rate. What consumer in their right mind would sign a cancellation fee documents if they fully understood it and knew that the banks and most brokers don't charge it.
  • Ron Butler | 01 Feb 2016, 01:56 PM Agree 0
    The consumer is actually best served by a service contract. If the mortgage broker cannot deliver the best rate or product as promised the broker pays the client some money, if the client takes the broker's commitment and just uses it as leverage to get a better deal from his existing lender, then the client should pay some money for the abuse of the brokers time and effort. If the purchase falls apart or the the appraisal fails or their is a title impediment, naturally the client pays zero. Very simple and most important very fair.
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