1. What is Mortgage Broker Commission?

In India, mortgage brokers typically earn a commission for facilitating home loans between borrowers and lenders. The commission is usually a percentage of the loan amount and varies based on the lender, loan type, and broker agreement.

2. How Does the Calculator Work?

The calculator uses the simple commission formula:

Where:

• \( Loan\ Amount \) — Total loan amount in INR
• \( Rate \) — Commission rate as decimal (e.g., 0.01 for 1%)

Explanation: The calculation multiplies the loan amount by the broker's commission rate to determine the total commission earned.

3. Importance of Commission Calculation

Details: Accurate commission calculation helps brokers understand their earnings, borrowers understand costs, and ensures transparency in mortgage transactions.

4. Using the Calculator

Tips: Enter loan amount in INR and commission rate as decimal (e.g., 0.015 for 1.5%). Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical commission rate in India?
A: Rates typically range from 0.5% to 2% of the loan amount, depending on the lender and loan type.

Q2: Who pays the broker commission in India?
A: Usually the lender pays the commission, but sometimes borrowers may pay a fee directly to the broker.

Q3: Is broker commission negotiable?
A: Yes, commission rates are often negotiable between the broker and the lender or borrower.

Q4: Are there regulations on broker commissions?
A: RBI guidelines govern mortgage broker commissions, and lenders must disclose these fees transparently.

Q5: Does GST apply to broker commissions?
A: Yes, GST of 18% is typically applied to broker commissions in addition to the calculated amount.