Posted on: 14th Jun, 2013 04:07am
Compensation given to an intermediary in a financial transaction is known as the finder's fee. Here the intermediary receives the reward as he/she brings the two parties together. A finder's fee can also sometimes be in the form of a gift from one party of the transaction (buyer or lender). This happens when the buyer or the lender feels morally obligated that the finder should be awarded for making that transaction possible. Fees given to the finder are also known as the 'referral income' or 'referral fee'.
In all financial transactions, including the case of taking out a loan, it is important to bring the two parties together. This is also true in the mortgage industry. Here the mortgage brokers or the real estate agents play a crucial role. Brokers/agents have good network with a large number of lenders. Given the financial situation and requirements of the borrowers, they can easily find out a suitable mortgage offer for the borrowers. They sometimes offer valuable financial suggestions to the home buyers too. For the services rendered, they are entitled to receive some commission. This commission is nothing but the finder's fees.
Generally, the finder's fees lie between 0.5-1% of the sale price. However, sometimes the fees may be as high as 10% of the sale price. However, check out the whether the intermediary has got the necessary license/registration or not before working with that intermediary.
In all financial transactions, including the case of taking out a loan, it is important to bring the two parties together. This is also true in the mortgage industry. Here the mortgage brokers or the real estate agents play a crucial role. Brokers/agents have good network with a large number of lenders. Given the financial situation and requirements of the borrowers, they can easily find out a suitable mortgage offer for the borrowers. They sometimes offer valuable financial suggestions to the home buyers too. For the services rendered, they are entitled to receive some commission. This commission is nothing but the finder's fees.
Generally, the finder's fees lie between 0.5-1% of the sale price. However, sometimes the fees may be as high as 10% of the sale price. However, check out the whether the intermediary has got the necessary license/registration or not before working with that intermediary.
Is it usual for a mortgage broker to get a "finder's fee?
and how much it happens to be?
and how much it happens to be?
Hi toolboxrefinance,
Yes, the mortgage brokers can definitely charge the finder's fee. As far as I know, finder's fee is negotiable.
Yes, the mortgage brokers can definitely charge the finder's fee. As far as I know, finder's fee is negotiable.
Hi toolboxrefinance!
Welcome to the forums!
I agree with what Adonis has said. It should also be noted that the finder's fee should be mentioned in the written agreement. To know more, you may even check out: "statutes.laws.com/maryland/commercial-law/title-12/subtitle-8/12-805"
Feel free to ask if you've further queries.
Sussane
Welcome to the forums!
I agree with what Adonis has said. It should also be noted that the finder's fee should be mentioned in the written agreement. To know more, you may even check out: "statutes.laws.com/maryland/commercial-law/title-12/subtitle-8/12-805"
Feel free to ask if you've further queries.
Sussane
Hi smithsussane,
I visited this link, the point 'b' cause me confusion. could u please tell me if the finder's fee is not an interest to the lender, then what? does borrower pay it additionally out of interest or the lender pays it.
I visited this link, the point 'b' cause me confusion. could u please tell me if the finder's fee is not an interest to the lender, then what? does borrower pay it additionally out of interest or the lender pays it.
Hi toolboxrefinance!
Welcome to the forums!
Well, what I can understand is that if the finder's fee does not exceed the amount that is permitted in the subtitle, then it won't be considered as an interest to the lender. For further clarifications, you can even get in touch with a local real estate attorney.
Sussane
Welcome to the forums!
Well, what I can understand is that if the finder's fee does not exceed the amount that is permitted in the subtitle, then it won't be considered as an interest to the lender. For further clarifications, you can even get in touch with a local real estate attorney.
Sussane
ok, alright, that is a good idea.thanx.