If you sell your credit card portfolio there is a very good chance that the broker will make more money from that sale than you will. In today's market, with bid prices down and a limited set of buyers, a broker's commission can be more than one-half of the premium available and quickly gets into the hundreds of thousands of dollars. This is not in the interests of the credit union, the credit union's members or even the buyer of the portfolio. But the brokers love it.

How can this be? This happens because of how most credit unions start to look at a credit card portfolio sale. Typically, a salesperson for a portfolio broker contacts the credit union suggesting a "free" or unreasonably low price review of the card program. This will include a look at "market bids so you can see what it's worth." There is no obligation to sell your portfolio, so this sounds like a good idea. Who doesn't want something free? But like many things that are free, this can get very expensive.

Here is the reason: If you allow that salesperson to proceed you will give them information about your credit card business. They will take that information and share it with potential buyers of your portfolio. When they do this they have "claimed" your "deal" and will get paid by the buyer if you sell the portfolio. Much like a Realtor, once a portfolio is claimed all other brokers are locked out (buyers will only review a portfolio through one broker). Critically, the brokerage company where the salesperson works has a prearranged compensation schedule with each buyer and the buyer only pays if you sell the portfolio.