Legal & General Mortgage Club director Jeremy Duncombe (pictured) expects lenders to follow Virgin Money by introducing retention proc fees.
From July Virgin will direct customers to brokers at the end of their terms. If brokers send customers back to the lender they will get a retention proc fee, which will be lower than for new business but still be “competitive” according to Virgin’s mortgage director Peter Rogerson.
Duncombe said: “This change sends a very strong message to the industry, and adds to the growing number of lenders now paying fees for retention. We expect to see this trend continue with more lenders following suit.
“The announcement that Virgin Money intends to pay a competitive proc fee to brokers for product switches is welcome news, as it recognises the increasing importance, cost effectiveness and quality of the intermediary channel for lenders.
“Legal & General Mortgage Club has been working closely with lenders on the subject of proc fees for years, so it’s fantastic that Virgin Money will soon be making payments that reflect the hard work which has gone into the service that brokers provide.