Broker negotiating a better rate on your behalf

A few weeks ago I wanted to shop for a better rate on my mortgage so I gave my broker a call. He suggested I call up the bank myself to negotiate, citing some privacy/contract agreement that prevents him from doing it...

My question is: is that really the case? I thought negotiating a better rate/deal was apart of a good broker's job, furthermore he has an ongoing relationship with the lender which adds more weight to the negotiation, whereas I am just a random account number.

Anyone knowledge in this field knows if my broker was telling the truth?
 
Privacy prevents this? What rubbish. Never had a lender come back to me with that.

We re-negotiate rates for existing clients all the time. We even do it for loans we didn't set up.

If you give the broker the info needed to negotiate (account numbers, loan amounts) it's kind of implied you're giving consent.
 
I've had it with Bank West that the client had to sign a consent form before they'd talk to me about the loan - another broker set it up though. I've never had it for one I set up myself though, that's definitely a bit weird.

It wasn't a pricing request from memory though.
 
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Change broker and get them to submit a request on your behalf. Depending on the bank the broker may or may not get paid for this, but this should not matter.

Done many a pricing for people that I earned no money from but the goodwill it buys is simply stunning in many cases.

I have never had a lender ask for consent with a pricing request btw.
 
Depends.

Its best to get the broker (and its part of their job) to request the pricing discount for almost all lenders except for ANZ and Westpac.

You will get a higher discount if you approach these lenders' discharge unit directly and not via the broker.
 
There are certain things brokers can't do on behalf of clients - but asking for a rate discount isn't one of them.

Cheers

Jamie
 
Do you know why that is Shahin?

There is a misconception that brokers can get better rates than applying directly to the bank or vice versa but its incorrect with most lenders. A good example of CBA where brokers and bankers send requests to the same team and this works very well.

Other lenders have different teams - one dealing with the broker and the other directly with the customers/bankers. Westpac is such an example. They have the MRU team for brokers but the pricing discounts they provide isn't as strong as the discharges unit which gives the customer a better rate when they say they want to refinance.
 
I go through broker for CBA loans, however there were at least 2 attempts by a CBA Loan Manager trying to lure me away from third party banking. It is so tempted to see what he can offer versus broker...
 
There is a misconception that brokers can get better rates than applying directly to the bank or vice versa but its incorrect with most lenders. A good example of CBA where brokers and bankers send requests to the same team and this works very well.

Other lenders have different teams - one dealing with the broker and the other directly with the customers/bankers. Westpac is such an example. They have the MRU team for brokers but the pricing discounts they provide isn't as strong as the discharges unit which gives the customer a better rate when they say they want to refinance.

Yep - using an example, I've had a deal where I asked Westpac to match NAB's offer, the BDM raised it up the chain and they came back saying that the level of discount wasn't possible via third party and it was best for the client to call retentions direct. I thought that was unusual given the channel the client was coming through, but the BDM mentioned then mentioned the above.
 
I go through broker for CBA loans, however there were at least 2 attempts by a CBA Loan Manager trying to lure me away from third party banking. It is so tempted to see what he can offer versus broker...

seeing you have launched that lure....................... : )


pls elaborate, because CBA is one of the lenders where the playing field on my experience is quite level.

ta

rolf
 
Most banks will allow brokers to neg the rate for existing loans ( existing customer of the broker or not...) - some smaller lenders ( Very rare and small group of credit unions really) don't unless there's an increase in loan ( ie equity etc...)
 
A few weeks ago I wanted to shop for a better rate on my mortgage so I gave my broker a call. He suggested I call up the bank myself to negotiate, citing some privacy/contract agreement that prevents him from doing it...

Until a little while ago, most lenders would NOT accept pricing requests from brokers................

Simple logic

Some brokers will take their entire loan book for a lender ( say 100 mill) and go, please get me the best pricing to match xyz or I will take them to lender ABC

Thats all good and well, and while the broker is the agent of the borrower, we all need to realise that these transactions involve at least 3 parties, often more parties indirectly.

Any ongoing funding needs to be win win win within reason

if you have a loan that was settled say in 2009, we know the lender can NOT meet todays rates on that money especially so if the funds were in part or totally securitised.

Its often more cost effective for the lender to let you go than to back price book to anywhere near todays costs.

Price is important and relevant, BUT if its one's core focus, Im certainly of no help since I cant add value to on line lo cost funders that are out there, and one would be better off running the on lien gauntlet - and some do it very well

ta
rolf
 
Wouldnt an internal refi take care of that ^^^^

Sort of, but at 800 to 1200 cost per loan transaction, this weeks 10 internal refinances will cost ones brokerage 10 000................. and there aint no additional income........wait, its better, you are moving from 25 to 15 trail, so you are double paying to provide the lower cost of funding...............

And we havent even covered the 30 k top ups............

there is a reason why even retail doesnt encourage reprice through internal refi - id guess its negative KPI stuff for them too.

While its important to look after existing relationships, there comes a point where it doesnt work for either party.

luckily, for most IP builders, there are sensible and logical reasons to move from lender x to lender y most of the time, so its not a dead rubber.

Most lenders will not provide the sharpest pricing on existing money unless there is some new money to help sway - eg cba

ta
rolf
 
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Mine once negotiated a better rate without my knowledge, as he was settling a loan.
I just got an email after, saying "Oh by the way, I managed to get another 0.1% off".

I was surprised, but happy.
 
Thanks everyone for your comments. I always knew he was a bit of a dud, this confirms it!

There is a misconception that brokers can get better rates than applying directly to the bank or vice versa but its incorrect with most lenders. A good example of CBA where brokers and bankers send requests to the same team and this works very well.

Other lenders have different teams - one dealing with the broker and the other directly with the customers/bankers. Westpac is such an example. They have the MRU team for brokers but the pricing discounts they provide isn't as strong as the discharges unit which gives the customer a better rate when they say they want to refinance.

Interesting Shahin, something to take into consideration if I ever want to renegotiate with Westpac/ANZ
 
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