Are Mortgage Brokers Independent?

A mortgage broker is a professional who acts as an intermediary and helps find home loans on behalf of individuals. In most developed countries today, mortgage brokers are the largest mortgage sellers for lenders.

In fact in Australia, independent mortgage brokers initiate more than 35% of all mortgages in the country. Brokers offer loan products from various banks, thus they are known as usually termed as one-stop shop to find the mortgage that’s best suitable to the needs of the borrowers.

Is a Mortgage Broker Independent?

Using a mortgage broker is a common option for those who are looking to finance their homes. Aside from the fact that using a broker saves you time, you almost always get a better deal when you work with a broker. Moreover, it is viewed that mortgage brokers give you an independent advice about the best product that suits your needs.

But since most mortgage brokers in Australia, especially the large ones, are owned, controlled, or affiliated with a major bank, you need to ask yourself if you are getting a truly independent advice from the person you are talking to.

How to Make Sure That You Get a Truly Independent Advice

Recent enquiry about practices of certain mortgage brokers had some buyers worried. It is important to make sure that the deal that you are getting is the one that favours you rather than the broker. Since it is always a possibility that commissions that brokers receive can lead to advice that is in their interest rather than their clients’, it is always important for borrowers to be always on guard.

According to ASIC website, a mortgage broker is not obliged to find borrowers with the best possible deal unless the borrower specifically agrees to do so. Brokers are often limited to a company-approved list of lenders. Thus, it is important that you ask your brokers upfront if a loan is available to you, a load that provides less commission.

Conduct an online research. Even if it is your first time to talk to a mortgage broker, you don’t need to step into the unknown. It is best that you research interest rates online to find out what are the best deals on the market. More importantly, you will be aware if the broker is offering you a rate that’s higher than what it should be. According to statistics, 31% of borrowers rely most of the time on a mortgage broker for information.

How to Deal With a Mortgage Broker

Before you finally consider getting a mortgage broker, here are some more tips and questions to ask before you finally select the one:

● How many lenders is the broker dealing with? A broker with a wide range of lenders is always a better choice compared to someone who is connected only two or three lenders. It ensures the broker’s independence and more importantly, it allows you to have more choices that might meet your needs.

● How does the broker get paid? There are lenders that pay higher commissions compared to others. Know how the broker is getting paid since this may be a factor when it comes to the solutions that he or she will offer you.

● What are the fees that the mortgage broker will charge you? Know firsthand and request that the fees, if any, be put in writing. Do not rely on verbal agreement for this would place you at a disadvantage later on.

● What is the process involved when it comes to recommending you the right solution? A good broker will be able to explain to you his or her standards and methodology for selecting appropriate mortgage solutions.

● What is the actual cost of the loan? You have to be aware of the costs, including the amount that you are borrowing and the ongoing costs, so you can do some comparisons with the other solutions being offered to you.

● Is the broker a member of a professional association of licensed mortgage brokers? He or she should be. If a broker shuns away from other professionals, this should be a red flag for you. Mortgage brokers have to be qualified, meaning they should be licensed, so that they would be able to give you the best mortgage advice.

During your search, ask someone you know who has used a mortgage broker. Ask your family, friends, or colleagues about their experience with brokers or ask for their recommendations. In your search for a broker, always think that the person you are looking for must be independent; that is, he or she should look for the best mortgage for you. He or she should not be on the lender’s side. He or she should give an unbiased advice and should give you access to a range of lenders and products rather than restricting your choices to a single range of lender or products.

If you are looking for independent mortgage brokers in Australia, 1300HomeLoan is guaranteed to help you in your search. We help you find a mortgage broker wherever you are located, whether in the city capital or in rural areas. Contact us today so you can speak with independent mortgage brokers. There are plenty of reasons why you should seek the services of 1300HomeLoan accredited brokers, especially when you are looking to buy your first home. Let our expert brokers handle your queries. Let them find the best deal for you.

Financial institutions are always looking after their own gain. With the help of your expert mortgage brokers, you can surely find the perfect solution for your needs. Give us a call at 1300-466-356 and we will find you a suitable mortgage broker in your region. We have the largest database of expert mortgage brokers in Australia so you are assured that you can find the most suitable mortgage broker to help you in your financing.

What are you waiting for, call us up or send an inquiry using our online form. Whether you’re looking to buy your first home or you simply want to check if you are getting the ideal finance solution for your needs, our mortgage specialists are ready to help you anytime.

If you'd like to know more email us -, or call 1300 466 356
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