The brokerage equity loan is a bank gasoline profession pursued by the broker or home loan mortgage broker. An intermediary in banking and payment services , he acts as an intermediary, for a transaction relating to real estate loans , between a financial institution and an individual or a professional seeking financing for real estate .
Borrowers may choose to use a broker who will look for a home loan from different financial institutions and obtain the best market conditions for these borrowers, given their financial situation. ( creditworthiness ) and their credit report.
In France , mortgage brokerage appeared in the 1970s. The company Cafpi , created in 1971, was the first to offer this offer. Due to changes in banking distribution, credit intermediation activity has since been in full development: in 2015, real estate loan brokers reached almost 40% of market share in the marketing of new loans. real estate loans to individuals. This practice is still much more common in other European countries: in England , 60% of market share, in Spain 50%, for example.
As with any banking contract, consumers must be careful and pay attention. Litigation with banking intermediaries is as widespread as that with banks .
The European Commission carried out a study on credit intermediaries in 2009, showing that they favor the freedom of choice of the customers and the effective exercise of competition between lending institutions, as well as the banking mobility of the private customers, seen , by some, as braked.
With the significant reform of the Monetary and Financial Code of 2012, brokers now enter Category 1 of Intermediaries in Banking Operations and Payment Services ( iobsp ), pursuant to Article R. 519-4 of this Code. The IOBSPs are divided into four legal categories.
This reform came into effect on January 15, 2013. Since then, the four categories of banking intermediaries, including brokers, have been supervised by the Prudential Supervisory Authority, with a view to better protecting financial consumers ( following the work of the G20 of September 2011 and the Report on “Business Conduct” of 2010) 1 .
On 13 September 2013, the European Parliament voted on the new Directive on mortgage lending, which gives a lot of space to intermediaries, ie brokers 2 .
This profession, very fragmented, remains poorly known statistically: about 30,000 banking intermediaries, whose share of brokers to the new meaning of the Monetary and Financial Code is better defined, since May 2013: about a quarter of these professionals identified and soon registered or, in the long run, probably 7.500 Real Estate Brokers.
In France, several professional bodies represent this profession: the CNCIOB [ archive ] (National Chamber of Intermediate Advice in Bank Operations) created in January 2010 by the CNCEF [ archive ] itself created in 1957; ASF (Association des Sociétés Financières) APIC (Professional association of credit intermediaries) created in July 2010, AFIB-IOB, ANACOFI-IOBSP  [ archive ] .
The use of a broker makes it possible to put all the banks in competition, to obtain advantageous rates and a more complete service. The person looking for financing that uses a broker benefits first of all from a saving of time. Indeed, it does not have to meet all the banks, one by one. But calling on a broker also implies a profit because, by their knowledge of the sector and the market, but also by the effect of the number of files presented in the bank, the brokers get attractive rates of borrowing.
When the client has provided him with all the information needed to evaluate the file (assets, liabilities, income, job stability, etc.), he can tell what the client can expect. For example, it will assess the maximum value of the mortgage loan that can be contracted, the amount of mortgage payments and other financial obligations, and the amount that must be paid as a down payment.
Credit Brokers Professional Training Organizations
As of 1 st January 2013 (pursuant to 15 January 2013), the credit Brokers, real or not, must have a certificate of professional competence. This is mandatory in order for the Broker to obtain registration in the Register of Intermediaries held by ORIAS , a condition required to perform the activity of intermediary in banking operations and payment services (IOBSP).
For this purpose, new training organizations have emerged to provide the specific banking training provided for IOBSPs. There is no centralized list of these companies, which are freely available, especially via the internet.
These bodies must, according to their own teaching methods, issue:
- training materials in accordance with the program provided for by Order
- an individual internship booklet showing the hours worked
- a certificate of competence, following a multiple-choice test of knowledge.
These elements are additional protective factors for clients who turn to Credit Brokers.
Remuneration of brokers
A mortgage broker has two ways to get paid.
- Firstly via a bank commission: with each loan granted through a broker, the banks pay back a commission fixed according to the agreements that have been signed, and which represents a percentage of the loan amount. This commission can be capped. It is the counterpart of customer input work, and covers a marketing / distribution fee that the bank has not, in fact, borne with the broker;
- and some brokers ask for remuneration from the customer: they charge their clients a fee (administrative fees and / or research mandate fees), which correspond to the provision of market information to the client, to the preparation its file, the comparative analysis of the offers and the proposal of a favorable rate and / or a bank whose strategy enters into the personal project of the client.
The principle of the broker’s remuneration is laid down by the Monetary and Financial Code , in Article L. 519-1.
Article L.519-6 of the Monetary and Financial Code stipulates that ” any natural or legal person who, in any capacity whatsoever and in any manner whatsoever, directly or indirectly obtaining or granting a loan of money, collecting a representative sum of provisions, commissions, research expenses, procedures, record-keeping or any other means, before the actual payment of funds lent .
A broker can not claim his remuneration from the customer (whatever the denomination: commission, fees, application fees …) after the provision of funds (“unlocking”) loaned or the regularization of the authentic deed at the notary.
Legal and Regulatory Considerations
Access to this profession and its exercise requires the respect of specific conditions. 3
Iobsp brokers in real estate loans are subject to general commercial and banking obligations. They must therefore respect specific obligations set by the Monetary and Financial Code for all credit brokers.
These obligations are heavier than those borne by the commercial bank branches. In fact, brokers must exercise an obligation to advise their clients, while bank sellers are subject to a lesser obligation: the obligation to warn.
Since January 15, 2013, banking regulations have provided greater protection to borrowers who subscribe directly to a real estate loan with a broker.
In the long term, this addition of an obligation to advise credit brokers- iobsp could jeopardize the obligation of lenders, limited to the warning 4 : the warning could well disappear to be replaced by an obligation to generalized and consistent advice, which would thus harmonize the protection of borrowers, regardless of the subscription channel chosen for credit.
If the exercise of this profession requires the respect of particular obligations, its access is previously regulated.
The practice of banking intermediation requires the registration in the Register of intermediaries of banking, insurance and finance, held by ORIAS .
Any person or company that commercializes banking operations (loans, payments, deposits) without this registration (publicly accessible) is in a situation of illegal exercise of the profession of banking intermediary, or credit broker.
The Mortgage Credit Directive (MCD) is applicable in French law on March 21, 2016, even transposed by France at a later date, no doubt the .
Notes and references
- This article is partially or entirely from the article titled ” Mortgage Broker ” (see the list of authors ) (see also the discussion page ) .
- ↑ Laurent Denis http://www.agefi.fr/articles/une-approche-didactique-de-la-distribution-bancaire-1274606.html [ archive ]
- ↑ http://www.village-justice.com/articles/annees-regler-finement-CARRP-new,15183.html [ archive ]
- ↑ http://proper-avocat.fr/credit-real-estate-to-particuliers-access-and-exercise-the-profession-of-distributor/ [ archive ]
- ↑ Towards the generalization of the obligation of advice in credits? | Laurent Denis / February 2014 | http://www.village-justice.com/articles/generalisation-obligation-conseil,16199.html [ archive ]