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By: Jessica Darnbrough
In a further sign that competition is beginning to emerge amongst lenders, a mortgage manager has increased the upfront and trail commission it pays to brokers.
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Effective from Monday, Collins Securities will push the commission structure on its low doc refinance product slightly higher.
The lender will pay brokers 0.6 per cent upfront commission and 0.25 per cent trail from the first year.
Previously, Collins Securities had not paid its brokers trail commissions in the first year.
The company’s chief executive officer Rob Emmett said the boost to broker commission was due to an increase in available funding.
“We have been fortunate enough to access greater funding recently, so we wanted to pass this benefit onto our brokers,” Mr Emmett told The Adviser.
“Unlike most bank commission payments, Collins will pay both upfront and trail commissions from year one. Another bonus will be the absence of broker upfront clawbacks.
“The low doc refinance product launched to the market in February has proven to be a huge hit with brokers as a result of this sector being decimated by the GFC.”
Mr Emmett said while the commission boost was targeted to the company’s low doc refinance product, he said the lender was hoping to deliver the same benefits to its suite of products in the future.
“Whether or not we can deliver that though comes down to demand and pricing. At present, we are trying to deliver a bit of differentiation to the market,” he said.
