The mortgage broker can be contacted by both banks and borrowers. Whether free or paid, this professional will systematically receive remuneration from the banking establishment where the loan is granted.
The concept of "free broker" only means that the free broker will not charge fees to his clients. The effectiveness of both does not come into play.
What are the methods of remuneration for a broker?
Facilitating the connection between a bank and borrowers, the broker can receive a commission from the banking establishment and fees from his clients:
- Representing around 1% of the loan amount granted, the remuneration committee is precisely defined in the commercial agreements concluded between the broker and each bank. Note that it is not reflected in financing proposals intended for the borrower. It comes in return for a connection that would not necessarily be made without its assistance: they are paid in their capacity as business introducers.
- Paid by the client, the broker's fees are freely fixed by them - either on a lump sum basis or around 1% of the amount of the loan granted. As a reminder: this remuneration is payable only if the mortgage is signed, in accordance with article L321-2 of the Consumer Code.
In all cases, the mortgage broker can only be paid if the loan file is accepted. They, therefore, have every interest in denouncing the weaknesses of a financing plan, in order to correct it and, thus, optimize the chances of going to committee.
Are paid brokers more efficient than free brokers?
The concept of "free broker" is intended for borrowers: these professionals have simply chosen not to ask their clients for fees. However, this intermediary does not offer its services free of charge, but its services are covered by the bank's commission.
In fact, the free broker is not comparable to a discount broker: it's quality and skills do not come into play in this appellation. Moreover, all these professionals are subject to the same regulation of Intermediaries in Banking Operations and Payment Services (IOBSP) and to the same code of good conduct (Monetary and Financial Code).
On this point, the paying broker has the obligation to establish, in writing, the amount of his fees, which cannot be collected - in any way - before the actual payment of the money intended to finance the purchase.
Whatever the method of remuneration adopted, the use of a broker generally allows buyers to earn between 0.40% and 0.50%, compared to the offer of a bank made without this intermediary. Knowing perfectly the commercial policy of the establishment, he is competent to negotiate the best rates, according to the profile of the applicant. Obtaining the most attractive offers for borrowers in the most comfortable situations (high level of income, wealth, debt ratio, etc.).