Mortgage Brokers may receive Up-front and Trail Commissions either via their Broker
Group or from Financial Institutions directly. They are then faced with the task
of splitting these commissions in various ways to ensure all parties receive the
splits they are due. These may include a split to the Broker Group, a Referral source
and a Loan Writer. Commission Management can be one of the most time consuming tasks
faced by a Mortgage Broking business and therefore BrokerSource was designed to
automate this process as much as possible. BrokerSource will not automatically pay
these commissions however will calculate them and produce "Recipient Created Tax
Invoices" (RCTIs) where necessary. Payments can then be made using traditional payment
methods such as on-line Internet Banking funds transfer or by cheque.
BrokerSource will provide the following benefits when managing Commissions:
- Monitor the up-front commission amounts that are expected to be received from your
Broker Group or Financial Institution directly using agreed commission formulas
to ensure that amounts received are accurate.
- Split the up-front commission received between Broker Group (usually already retained),
Referral sources and Loan Writers where applicable ensuring payments are made accurately.
- Trail commission amounts are based on the outstanding balance of loans referred
to Financial Institutions. They are impossible to predict due to the many external
factors that can affect the loan's balance. BrokerSource will allow a Mortgage Broker
to input Trail commissions received each month and then automatically split these
amounts according to the various agreements in place ensuring payments are made
- Automatically produce "Recipient Created Tax Invoices" (RCTIs) accompanying each
commission ready for payment to all relevant parties which will save you time and
streamline this process.
- Calculate the commissions to be retained by the Mortgage Broking business (or principal)
to monitor revenues and assist with Income Tax and GST provisioning.
- Allow for the reversal of commissions received (and paid, where applicable) to cater
for any "claw backs" applied when loans are repaid early in accordance with the
various Financial Institution's rules.