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Online proc fee rebates spark fears

Brokers have raised concerns that a direct mortgage website that pays half the proc fee to the customer could create commission bias and misbuying.

The website, moneyback mortgages.com, searches for a mortgage from its panel of 53 lenders based on the borrower’s personal details and rebates 50 per cent of the proc fee.

On a 200,000 mortgage, the highest share of proc fee advertised is 1,270 from Mortgages plc.

Chase de Vere Mortgage Management director Nick Gardner says: “There has to be a concern that if there is a fat proc fee, will members of the public go for the deal with the highest money back, regardless of all the hidden nasties?

“Even mortgage brokers have a tough time finding the best mortgage so there is a danger tat the customer will not be able to as there are a whole raft of considerations. There is a danger more consumers than not will choose the wrong mortgage.”

The website’s co-founder Simon Edgar says: “As people find their mortgage on our site and we have done half the work, we give back half the commission.”

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