Five things I do to earn trailing commission

Trail is a hot topic of conversation right now and I want to break it down. What is it? And what do I really do to earn it?

What is it?

As a broker, when I help a customer secure a loan through a particular bank, I get paid two types of commission by the lender for bringing the business to the bank.

The first is a one off payment called an upfront commission usually somewhere between 0.65% (+gst) to 0.7% (+gst). The second, being trail or ongoing commission usually set at 0.15% per annum, based on the remaining loan amount each year. Currently, I receive this trail commission every month for the life of the loan.

I absolutely do not work for the bank. I receive trail due to the quality of the business I bring in and the way I manage the relationship with the borrower. Once a loan is settled, I’m still on the lookout for my clients.  I’m relentless in five main areas as a Loan Market broker:

  1. Refinancing: I keep one eye on the market and one on your client’s loan. When I spot a more competitive deal, I help move them over.
  2. Repricing: Changing lenders is tougher in a tightening credit market. But there are often options through their existing lender. I can often get a more competitive deal with their existing lender. It’s quick and means I can still help them with things like increasing their loan.
  3. Better utility prices: Through our partners Loan Market Home Now, we’ll take your client’s gas, electricity and internet bills and compare them against Australia’s leading brands on our panel to find them a better deal. On average, potential annual savings are $882 on their household running costs*. Go here for more.
  4. Annual review: Each year, I run a ruler over everything, to be 100% sure your client’s goals and ambitions are on the path of being met by their loan. Renovation, baby on the way, upsizing? I’ll find the right loan to work for them.
  5. I keep the client in the driver’s seat: I’m committed to maximising your client’s funds. I can connect them with our financial planning partners, for everything from insurance, budgeting, super and estate planning. It’s important they have a plan to cover their mortgage, when something unexpected happens.

So yep, I do all that and more. Would a bank? If you want to find out more about these services, drop me a line.

*Average potential annual savings from bills received from Nov 2018 to Feb 2019.