Commissions: How much do mortgage brokers get per loan?

Just wondering... as my bank finance manager seems to really want us to signup to a loan + insurance asap. Do they get extra commission per loan or do they need to meet a certain quota per month?

~ How much do bank finance managers who work for big 4 get for each home loan they submit as bonus/commission?

~ How much do 3rd party brokers get for each home loan they signup?
 
Just wondering... as my bank finance manager seems to really want us to signup to a loan + insurance asap. Do they get extra commission per loan or do they need to meet a certain quota per month?

~ How much do bank finance managers who work for big 4 get for each home loan they submit as bonus/commission?

~ How much do 3rd party brokers get for each home loan they signup?

brokers get up to .7% upfront commission and up to .3% ongoing trail commission. Most banks pay around .6% upfront and from 0 to .2% ongoing. Most branch staff are on wages plus incentives based on performance.
 
Just wondering... as my bank finance manager seems to really want us to signup to a loan + insurance asap.

Ummm, thats their job :) so I would hope that they would be keen to get you to commit

What gets measured gets done, and in their instance the KPIs are usually pretty clear and not easily achievable for the average HFM, personal banker etc.

Id expect the bonus income at branch level varies from "you get to keep your job" to open ended depending on what area the banker actually works in and where the lead base comes from.

On brokers, the average gross numbers are around 62 upfront and 18 trail.

The "average" broker gross considerably less than 70 000......................... and some do a bunch better.

ta
rolf
 
brokers get up to .7% upfront commission and up to .3% ongoing trail commission. Most banks pay around .6% upfront and from 0 to .2% ongoing. Most branch staff are on wages plus incentives based on performance.

Any chance of breaking that by banks?
How long does the trail commission last?
 
Any chance of breaking that by banks?
How long does the trail commission last?

most lenders will pay trail while the loan is in place and good order, and is paid on the outstanding

Different broker groups will do better with certain lenders due to differing volumes which may influence the amount a lender will pay, so its not useful to have a specific breakdown.

On average loan life, NAB direct and Westpac are often at the bottom of the barrel, ANZ STG and Homeside are often near the top of that scale, but as I say it does vary a little

ta

rolf
 
Any chance of breaking that by banks?
How long does the trail commission last?

I can send you my credit guide if you like it has a per lender breakdown. Pm me. I give this to all clients / enquiries. Trail last as long as the loan itself. It's not added to the rate you pay.

In terms of branch lenders I got the good oil from an ex colleague recently (works for one of the larger regional banks). He has a quarterly target of $5mil and anything over that they get 0.2% (on the whole amount settled) so say he writes $6 mil each quater he would get base salary circa $60k pa plus $48k pa bonus / commissions. Not bad. No wonder they are pushy what gets me is the non disclosure!
 
Just wondering... as my bank finance manager seems to really want us to signup to a loan + insurance asap. Do they get extra commission per loan or do they need to meet a certain quota per month?

~ How much do bank finance managers who work for big 4 get for each home loan they submit as bonus/commission?

~ How much do 3rd party brokers get for each home loan they signup?

The others guys have touched on how much brokers get paid.

I spoke with a lender from a big 4 last year about her KPI's - apparently hers were based on the number of loans settled and not the overall amount of funds settled.

Cheers

Jamie
 
20 mill a year sounds small

108 000

nice considering negligible business expenses

ta
rolf

I was surprised too but apparently not many write this much. I would have thought would be easy with the existing base but he said they do a lot of maintenance work (50% odd) that doesn't get included in the figures which makes sense.
 
I work as a Personal Lending Manager for one of the Big4

I'm paid a base salary, this increases with time in the role and obviously negotiated with performance.

Then this is a large criteria for an extra payment which is far off just writting loans and getting upfront commission and trail like a broker.

- Behaviors
Minimum level must be achieved across four areas, performance driven, accountable, customer focus and team work

- Risk Management
Minimum level of lending accuracy and lending compliance

The above are gate openers, if you don't meet the minimum standard for these you aren't eligible for any further incetives.

I have set targets for mortgage lending revenue
Along with targets for other banking products

Incentive payment formula
(Revenue - target) x trail multiplier x customer experience x share rate = payment

So although alot of the brokers believe that the trail isn't important to a banker it is as it's used as a multipler, if the branch looses 20% of it's business then multiler will be 80%

Customer experience is a massive deal for my employer, if your customer service isn't a particular level then your multiplier can be 0 and we all know what happens when you multiply 0

And share rate it moved to what the bank is targeting. So mortgage leading is 65% whereas other products are 30%, so obviously lending is more of a focus.
 
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Customer experience is a massive deal for my employer, if your customer service isn't a particular level then your multiplier can be 0 and we all know what happens when you multiply 0

Ahhh - I'm onto you Brady (although it's probably no secret which lender you work for).

There's only one major I can think of where the staff seem to have a permanent smile glued to their face and welcome every person into the branch.

Cheers

Jamie
 
Just wondering... as my bank finance manager seems to really want us to signup to a loan + insurance asap. Do they get extra commission per loan or do they need to meet a certain quota per month?

~ How much do bank finance managers who work for big 4 get for each home loan they submit as bonus/commission?

~ How much do 3rd party brokers get for each home loan they signup?

Look at the stats. I would say the average broker and banker gets paid roughly the same - $60,000-$70,000. The thing is the exceptional brokers get paid far more because it is a business where the sky is the limit. As others have said brokers get about 0.65% upfront commission and 0.15% trail.
 
great replies everyone! thank you

how do banks measure "customer experience" and then assign a multiplier to that?
 
Ahhh - I'm onto you Brady (although it's probably no secret which lender you work for).

There's only one major I can think of where the staff seem to have a permanent smile glued to their face and welcome every person into the branch.

Cheers

Jamie

Haha pretty sure most know who I work for :)

But at this stage I only post as an personal investor ;)
 
I was surprised too but apparently not many write this much. I would have thought would be easy with the existing base but he said they do a lot of maintenance work (50% odd) that doesn't get included in the figures which makes sense.

I heard from an ex-CBA employee that the easy way to overcome that is to just refinance broker-originated CBA loans as this counts as new business.
 
great replies everyone! thank you

how do banks measure "customer experience" and then assign a multiplier to that?

By contacting the customers who else :)

My employer contacts the client and asks them to rate my service.

If my clients rate my service <9/10, so an 8/10 then that is equal to a 0 :(

A 9 or 10 will give you 100% but a 8 or below will give you 0%

I will have 12 surveys each 6months, the total are averaged.

From the average you will have a final percentage,

If you are below a certain percent you will close your bonus.


For me I write >5 loans a week.

So of the 130 loans I write they will only survey 12.

So for me every single customer has to be very important no matter the size of the loan.


I can't pick and choose what deals I want to have.

I have to complete every application with the best service possible.
 
By contacting the customers who else :)

My employer contacts the client and asks them to rate my service.

If my clients rate my service <9/10, so an 8/10 then that is equal to a 0 :(

A 9 or 10 will give you 100% but a 8 or below will give you 0%

I will have 12 surveys each 6months, the total are averaged.

From the average you will have a final percentage,

If you are below a certain percent you will close your bonus.


For me I write >5 loans a week.

So of the 130 loans I write they will only survey 12.

So for me every single customer has to be very important no matter the size of the loan.


I can't pick and choose what deals I want to have.

I have to complete every application with the best service possible.

Just out of interest, are you told which of your customers were surveyed, or is it kept anonymous?
 
I heard from an ex-CBA employee that the easy way to overcome that is to just refinance broker-originated CBA loans as this counts as new business.

Probably a reason why your friend is an ex-employee.

This information is wrong on a few accountants.


CBA Bankers shouldn't be refinancing any broker deals unless they don't want to deal with the original broker anymore and the structure or loan type isn't correct.
And this should go the other way, but from my understanding there is no recourse for when a broker rewrites existing business. If a banker were to rewrite a broker loan without say a letter from the client and/or advising the BDM or broker direct there would be a please explain.

Secondly rewritting or churning of any internal business dones't count for anything, well not quiet it will then go to the branchs trail which is a multiplier but wont make a significant different. But the actual banker will not get any revenue upfront.
 
Just out of interest, are you told which of your customers were surveyed, or is it kept anonymous?

Anonymous.

But alot of the time customer will tell me :)

And sometimes you can tell by the comments that they make.

Its mulitple choice around the service provided.
 
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