Complete FS – second charge loan charges are still too high
Complete FS, the South Coast based specialist lending packager, still believes that reductions in fees by second charge master brokers still have a way to go to appeal to a wider range of brokers.
Back in early May, Complete FS unveiled its new charging structure for second charge loans which completely does away with a Master Broker fee and replaces it with a flat application fee of £199 plus valuation and legal fees.
According to director, Tony Salentino, Complete FS was the first packager to slash its fees to better reflect the kind of structure familiar to brokers in the first charge market.
He said: “We are delighted to see that some master brokers have followed our lead by cutting fees, but many have not or have made only cosmetic changes. We believe that the right course of action is for the industry to renounce the old fee structure and introduce a flat application fee. We charge £199 along with the lender’s valuation fee and disbursements on all second charge cases. There is no Master Broker Fee and the intermediary determines the advice fee to be charged.
“What is important is that the client can see exactly what he is paying for. Advisers now have more clarity which means that they can confidently compare a first charge remortgage more clearly with a second charge loan. Costs are going to come under the microscope and if the second charge sector is to continue to grow, then reduction of fees and more transparency are going to be very important in persuading first time adviser users to properly consider a second charge option for clients. There are plenty of good reasons why a second charge loan is suitable, but costs are a major factor in that calculation.”