Mortgage Broker

Published 08 June 2022Updated 25th January 2023

Mortgage Broker

What is a Mortgage Broker?

A mortgage broker is a financial professional that helps home buyers and investors secure a home loan. They act as a middleman between lenders and borrowers and handle all the paperwork and admin of securing a mortgage.

Securing the right home loan for your needs can be complex and confusing, which is why many borrowers choose to work with a mortgage broker. They can assess your needs, your financial situation and your investing goals and match you with the right lender and loan product.

In many cases, mortgage brokers have access to loan products and rates that aren’t available to other borrowers and home buyers. That means you may be able to secure a cheaper interest rate or better loan terms by working with a broker (rather than going to the bank directly).

Plus, a mortgage broker can handle the entire loan application process from start to finish, taking a heap of paperwork and admin off your plate.

FAQs about Mortgage Brokers

What does a mortgage broker do?

Mortgage brokers help borrowers (both homebuyers and property investors) to find the right kind of home loan for their needs.

They have an in-depth understanding of how home loans work as well as the pros and cons of different lenders. Plus, brokers can offer strategic advice on which loan product might be the best fit for you as a borrower.

All mortgage brokers in Australia need to be registered with ASIC as a licensed Credit Representative and Credit Licensee. This ensures they’re licensed to give you advice on a range of different loan types and products.

In broad terms, here’s how a mortgage broker can help you find the right loan option for your needs:

Identify your needs and goals: your broker will start off by asking about your property purchase goals and objectives, such as whether you plan to live in the property or rent it out. This will give them a clearer picture of why you’re buying a home and what kind of mortgage will help you reach your goals.
Assess your borrowing capacity: your broker will also do a range of preliminary checks to make sure you have the ability to secure a home loan. This can include sharing details about your income, employment, any existing properties you own, and any debts you’re paying off. They might also ask questions about your monthly expenses to get a full picture of your financial position.
Compare your home loan options: the best mortgage brokers will work independently of any bank or financial institution, and will be able to recommend loan options from a range of different lenders.
Explain how each loan product works: once they’ve narrowed down your product options, your mortgage broker will be able to thoroughly explain how each mortgage works, what features you can expect and any extra bonuses that can help you pay less over the lifetime of your loan (like the ability to link offset accounts to your loan).
Manage the application process through to the settlement: once you’ve made an informed decision about which loan product is right for you, your mortgage broker will be able to collate all the information and documents you need to prepare and submit your application. Your broker will manage all communications with the bank or lender on your behalf and will continue assisting you all the way through to settlement.

Can a broker help me get a mortgage?

Absolutely - it’s what mortgage brokers specialise in! The best, qualified mortgage brokers have access to a broad range of loan options and lenders and are one of the best sources of tailored recommendations when it comes to securing a mortgage.

They will help gather all the details they need from you (such as your income, assets, employment details, any debts you owe, and your monthly expenses) and will prepare and submit your mortgage application on your behalf.

Plus, if the bank comes back with any questions they will act as the go-between to gather any extra documents and get your application over the line as efficiently as possible.

I am a first-home buyer, do I need a mortgage broker?

A mortgage broker can help take a lot of the stress, confusion and guesswork out of securing a mortgage. Especially if you’re a first-time home buyer, having a broker manage your application from start to finish can be a big weight taken off your shoulders.

In more specific terms, here are a few key benefits of working with a mortgage broker:

Boost your financial education: if you’re unsure about how home loans work or which features will help you save the most money, a broker can guide you through the entire process. They’re able to advise you on your options and demystify the complexities of securing a mortgage, especially if you’re unsure or overwhelmed by your options.
Tailored recommendations: mortgage brokers take the time to consider your unique circumstances and property goals and have access to a wide range of loan products for you to compare and choose from. This can significantly reduce the time it takes to research your loan options and can help you secure approval for the right loan, sooner.
Free professional service: one of the biggest benefits of using a mortgage broker is that they’re free for borrowers. That means you won’t need to fork out any upfront costs and can focus instead on securing the perfect investment property.

How do mortgage brokers get paid in Australia?

Since there are no upfront costs to working with a mortgage broker in Australia, in most cases, mortgage brokers are paid a commission or fee from banks for selling their products.

Some brokers earn the same commission from all banks, while others will get a higher commission from certain lenders or loan products.

As a borrower, it’s really important to ask the right questions and find out how your specific mortgage broker earns their commission. That way you’ll know whether their advice and recommendations are unbiased, or if they may be influenced by the commission they receive.

Disclaimer: The information provided on this blog is for general informational purposes only. All information is provided in good faith; however, we do not account for specific situations, facts or circumstances. As such, we make no representation or warranty of any kind whatsoever, express or implied, regarding the accuracy, adequacy, validity, reliability, availability or completeness of any information presented.

This blog may also contain links to other sites or content belonging to or originating from third parties. We do not investigate or monitor such external links for accuracy, adequacy, validity, reliability, availability or completeness, and therefore, we shall not be liable and/or held responsible for any information contained therein.

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FAQs about Mortgage Brokers

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