Clients are reeling because some of the banks, namely Standard Bank as well as ABSA are not letting originators choose the attorneys that will register the bonds anymore.
The implications?
Many originators that have been in the business a long time have built up relationships with certain attorneys. What many have done was to have an agreement in place that if they referred a client to that attorney to attend to the bond registration the client would receive a substantial discount.
These discounts were even up to 50% of the attorney's fee, which ensured a big saving for the client.
For instance, on a R500 000 bond, if the the client got a 50% discount he would only have to pay the attorney +/- R3078, now, that amount doubles up to R6156.
You can further double up that amount on a R1 000 000 bond.
If the bank chooses the registration attorney, the originator has no relationship or agreement in place, which means the client loses out.
Where will this end?
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