How to value an Australian mortgage broker's trail book

A working broker's guide to estimating sale value — annual trail, run-off rate, lender concentration, and the multiples that actually land deals.

If you are thinking about selling your broker book — or just want to know what it is worth as a balance-sheet asset — the conversation lands on one number: the effective multiple applied to your annual trail commission.

This piece walks through the math the way a buyer will, with the inputs you can pull from your aggregator statement today.

The core formula

Book value = annual trail × effective multiple × (1 ± 15%)

The 15% spread is the negotiating room. The multiple is where the heavy lifting happens.

Base multiple in 2026: 2.0× annual trail commission for a clean, mid-sized AU residential book.

What pulls the multiple down

Buyers will discount your book for any of these signals:

Run-off rate above 12% per year. If more than one in eight loans walks off the book each year, the buyer is paying for trail that may not be there in 24 months. Worth roughly -0.3×.
Top-lender concentration above 50% of trail income. A book that is 60% CBA is one lender-policy change away from a 60% revenue hit. -0.2×.
Arrears rate above 3%. A few stressed loans don't move the needle, but a real arrears spike signals weak repayment behaviour. -0.5×.
Recent settlements. Loans inside the 24-month clawback window come with their own risk — buyers usually discount C-grade loans further.

What pulls the multiple up

A-grade share above 60%. Mature, P&I, diversified loans with healthy LVR are the asset class buyers actually want. +0.2×.
Clean, defensible data. Spreadsheet-only books take weeks to diligence. A book with structured trail history sells faster (and often for more).

Why the data quality matters

The biggest gap between what a broker thinks their book is worth and what a buyer offers is rigour. Buyers will ask:

Show me your run-off rate by month for the last 24 months.
Break out trail income by lender — top 5 by share.
Which loans are in the clawback window?
Are there any silently-dropped trail commissions in the last 6 months?

If the answers come from a spreadsheet, the buyer will discount for risk. If they come from a system that audits month-on-month deltas — including missing trail commissions — the discount disappears.

What Trail AI does with this

The Trail AI valuation PDF runs the full algorithm above against every loan in your book and produces a single document you can hand to a buyer the same day. A–E grade per loan, run-off rate, lender concentration with the percentage drop applied to the multiple, arrears rate, clawback exposure, and the ±15% sale-value range.

Try the valuation calculator for a quick estimate, or upload a statement on a free trial to see the real numbers.

TL;DR

Base 2.0× annual trail commission, ±15% spread.
Discount for run-off, lender concentration, and arrears; bonus for A-grade share.
Defensible data wins the deal. Spreadsheet books get discounted; system-of-record books don't.