The mortgage manager’s role is to collect interest from the borrower and distribute it to the lenders. There is no need for a mortgage manager if:
- the mortgage requires pre-paid interest for the term;
- the lender provides their bank account details directly to the borrower in an Epitome of Mortgage;
- a mortgage syndicate requires the borrower to break up the monthly interest payments and pay them to each lender separately.
The usual fee for the role is 0.5% of the principal per annum. This may be negotiated up (if there are a large number of contributors) or down if the principal amount is over $2M.
Sometimes the role of mortgage manager and administrative agent will be combined.