What is your trail book worth?

How trail books are actually valued

The headline method is simple and nearly universal: net annual trail × a multiple. Everything else is an argument about what the multiple should be. Books change hands somewhere around 1.9–3.75× depending on quality, with 2.4× a reasonable starting point for an ordinary book.

The word doing the work is net. Trail is quoted gross on lender statements, and your aggregator takes a share before it reaches you. Valuing off the gross figure inflates the answer by whatever your split is — which is exactly the mistake that makes a first valuation feel too good.

Where the market sits in 2026

Reported sale multiples have firmed. The Adviser reported trail books changing hands at around three times annualised trail through FY2024–25 as buyer demand rose, and the Radar Results price guide put its forecast range for mortgage trail books to June 2025 at 2.75–3.75×. The model on this page starts an ordinary book at 2.4× and will not go outside 1.9–3.75× — deliberately conservative at the low end, because a first self-valuation is more useful when it errs toward what a cautious buyer would pay than toward the best print in a rising market. Quality adjustments carry a strong book to the top of that range.

Sources: The Adviser — trail book values rise as buyer demand increases; Radar Results price guide, via industry reporting. Multiples move with rates and demand — treat any figure here as context for a conversation, not a quote.

What moves the multiple

• Run-off — the rate the book decays. It dominates everything else, because a buyer is purchasing future trail, not today’s. A book shedding 25% a year is worth far less than the same trail shedding 10%.
• Clawback exposure — loans settled inside 24 months carry a refundable upfront. A book weighted to recent settlements transfers that risk to the buyer. The lender clawback schedule shows how much, by lender and month.
• Seasoning — older loans have demonstrated they stay. Age is evidence.
• Lender concentration — if most of your trail sits with one lender, a single repricing decision or channel exit moves your whole income.
• Data quality — the quiet one. If you cannot produce clean loan-by-loan data, a buyer discounts for what they cannot verify. This is worth real money at the table.

A worked example

A $100M book netting 15 bps after the aggregator split earns about $150,000 a year. At 2.4× that is roughly $360,000. Now change one thing: run-off at 25% instead of 15% takes 0.4 off the multiple, landing near $300,000 — a difference of about $60,000 on the same trail income.

That is why the diligence is about retention, not revenue. Two books with identical trail can be worth materially different amounts, and the gap is what the buyer believes about next year.