Fees for a mortgage application for client

ademoore

Just going through my first mortgage application verification and actually wondering what others charge for one of these?

I have found a sample covering letter from the toolkit, and reading that the bank can come back at you should the client default has questioned the amount I should be charging for this!?

Any advice welcomed!
Thanks

Monsoon

Depends on how complex it is. If it's just coyping some figures and sending a standard letter, or filling out a standard form, then I don't charge if they are a regular customer.

If it's more complex or one-off then I will charge.

We used to charge £50 for one but I went off the idea of doing it, as they don't come up that often.

TreadStone

Just wondered how the Bank can come back to you if the client defaults ? Surely all you are supplying are actual figures. A bit different if you then go on to say that they are solvent when they're not but surely that's the Bank's call ??

Just curious - haven't done one for quite a while.

Monsoon

TreadStone wrote: »

Just wondered how the Bank can come back to you if the client defaults ? Surely all you are supplying are actual figures. A bit different if you then go on to say that they are solvent when they're not but surely that's the Bank's call ??

Just curious - haven't done one for quite a while.

The bank ask a question that "in your opinion are they good for this mortgage"

I reply with "Based on our knowlege of the client we know of no reason why they should not be suitable."

I've never heard of a bank coming down on the accountant, but it's always good to cover your botty.

T.C.

I never charge my regular clients.

ademoore

Great!

That's really great, thanks for all your input!

jamesm96

The ICAEW recently issued some guidance on this, recommending that accountants not charge for providing references:

References should always be treated with caution. They can give rise to unexpected liabilities for the provider. Charging a fee for a reference increases the accountant’s risk in a way that is beyond management: it leaves the accountant exposed. Providing guidance to this effect does not mean that ICAEW is not being commercial. On the contrary, such guidance demonstrates a proactive and sophisticated approach to managing risk and informs accountants of matters that might not otherwise occur to them. Accountants will have their eyes wide open to the possibility of pitfalls if they decide not to follow the guidance.

That said, I do feel that if you're invoice is for 'administration charge' rather than 'reference preparation' then the risks are probably avoided anyway.