Mortgage broking valuations for Melbourne brokers selling a trail book or a whole business.
For selling or buying a loan book, a broker retiring, a partner leaving, and moving the business between entities. Fixed fee, set by turnover.
A Melbourne mortgage broking business is valued mainly on its trail income: the monthly payments from lenders on loans already settled, which shrink as borrowers refinance or repay. Our valuers project that income from the actual loan book, allow for how fast it runs off and for clawback of upfront income on recent loans, check that the aggregator agreement lets the trail be transferred, and then consider whether the business also brings a reliable flow of new loans a buyer can keep.
The trail book is the main asset
Trail income comes in every month for as long as a loan stays with the lender, and stops when the borrower refinances elsewhere, sells or pays the loan off. So a trail book is a wasting asset: without new loans it gets smaller each year. The valuation works from the loan-level data the aggregator provides, not the profit and loss alone. It looks at the balance of each loan, its age, the lender, whether it is owner-occupied or investment, and whether it is on a fixed rate that will end soon. Older loans that have stayed through several rate cycles tend to be stickier than recent ones. Recent loans carry another risk: upfront income received on settlement can be clawed back if the loan is discharged early, so the valuer allows for that exposure on loans still inside the clawback period set by the lender or aggregator.
Runoff, rate cycles and Melbourne borrowers
How fast a book runs off depends on who the borrowers are. A book built on first home buyers in Melbourne's growth areas, such as Werribee, Tarneit, Craigieburn or Clyde North, behaves differently from a book of established borrowers in the eastern suburbs with large loans and steady incomes. Fixed-rate expiries, lender repricing and borrowers selling up all trigger refinances, and some of those borrowers come back to the same broker for the new loan. The valuer measures the book's own history of discharges and how many of those borrowers were kept by the business on a new loan, rather than applying a standard runoff rate, and states the assumption in the report.
Licensing and the aggregator agreement
Brokers need authorisation to arrange home loans. ASIC says you generally need an Australian credit licence to engage in credit activities, unless you act on behalf of a credit licensee, for example as a credit representative. Many Melbourne brokers work as credit representatives under an aggregator's licence, and the aggregator agreement sets the rules for the trail: who receives it, whether it can be assigned, and what consent a sale needs. A trail book that cannot be transferred to the buyer is worth far less to that buyer, so the valuer reads the agreement before valuing the book. Brokers also carry a statutory duty when providing credit assistance to consumers, explained in ASIC's Regulatory Guide 273, and a buyer will look at how well the business documents its loan recommendations. Licensing and compliance questions are for the parties' lawyers and the licensee.
New business flow and the broker who stays
Some buyers want only the trail. Others want a business that keeps writing loans. New business depends on where clients come from: if most leads arrive through the selling broker's personal network, or from one or two real estate agents or accountants who know that broker, a buyer cannot assume they will continue. If clients find the business through its own name, website and reviews, more of the flow is likely to stay. The valuer sets a market salary for the brokers and support staff, keeps aggregator fees, software, professional indemnity cover and marketing at their real cost, and values the new business flow separately from the trail where that helps a buyer see what they are paying for.
When Melbourne broking businesses are valued
- ·Sale of a trail book to another broker or a broking group
- ·Sale of a whole broking business with its staff and brand
- ·A broker retiring, or a partner leaving and the others buying their share
- ·Moving the business or the trail between family entities
- ·Bank finance to fund a book purchase
- ·Market value evidence for small business CGT concessions on exit (your accountant applies them)
Common questions.
How much is my mortgage broking trail book worth?+
It is worth the trail income a buyer can expect to collect over the life of the loans, less the cost of servicing them and allowing for clawback, brought back to today's value. The size, age and lender mix of the book, and its own runoff history, matter more than a market multiple. The report shows the projection and every assumption behind it.
Can I sell my trail if I am a credit representative?+
Often, but it depends on your aggregator agreement. As a credit representative you work under the aggregator's licence, and the agreement usually sets whether trail can be assigned, to whom and with what consent. The valuer reads the agreement first, because a book that cannot move to the buyer is worth much less to them.
What is clawback and how does it affect value?+
Clawback is when a lender or aggregator takes back upfront income because a loan was discharged within a set period after settlement. For a valuation, recent loans carry that exposure. The valuer identifies loans still inside the clawback period and allows for the expected cost, using the book's own history of early discharges.
Why does a trail book lose value every year?+
Because loans leave. Borrowers refinance, sell or repay, and trail stops on each loan that goes. Without new loans the book shrinks, so the valuation projects how fast your book runs off based on its own history, and values the trail on that declining path rather than as steady income.
Is the business worth more than the trail alone?+
It can be, if it reliably writes new loans that do not depend on you. Clients who come through the business's own name, staff and online presence are more likely to stay with a buyer. Where new business mainly comes through your personal contacts, the valuer gives it less weight.
What does a valuation cost?+
The fee is fixed before work starts and set by annual turnover: $1,495 + GST under $2 million, $2,495 + GST for $2 million to $3 million, $3,495 + GST for $3 million to $10 million, and a written quote above $10 million. Small reports take 2 business days and medium and large reports 3 business days, counted from when payment and all required information have been received.
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Small Business Valuation
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Last reviewed 11 November 2026 by Business Valuations Melbourne, Level 7, 55 Collins Street, Melbourne.