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Using a mortgage broker

How to work with a broker to get a better home loan deal

Page reading time: 3 minutes

With many lenders to choose from, you may decide to get help from a mortgage broker. Ask the right questions to get a home loan that meets your needs and is value for money.

What mortgage brokers do

A mortgage broker is a go-between who deals with banks or other lenders to arrange a home loan for you.

A good broker works with you to:

How mortgage brokers get paid

Often, lenders pay the broker a fee or commission for selling their products, so you don't pay the broker anything.

Some brokers get paid a standard fee regardless of what loan they recommend. Other brokers get a higher fee for offering certain loans. This could influence the loans a broker recommends to you.

Sometimes, a broker will charge you a fee directly — instead of, or as well as, the lender's commission.

If you're not sure whether you're getting a good deal, ask around or look online to see what other brokers charge.

Before you meet with a mortgage broker

Check the broker is licensed

Before meeting with a broker, make sure they have a license to give you credit (loan) advice.

Search the following three lists on ASIC Connect's Professional Registers:

To search, choose the list name in the 'Select Register' drop-down menu.

If the broker isn't on one of these lists, they are operating illegally.

Consider your must-haves and nice-to-haves

Before you see a broker, think about what matters most to you in a home loan. Do you simply want the lowest cost loan? Do you want specific features, such as being able to make extra repayments?

Thinking about this beforehand will make the conversation with your broker easier. Make a list of your:

See choosing a home loan for advice on what to consider.

Meeting with a mortgage broker

Bring your list of must-haves and nice-to-haves.

Ask questions. Lots of them. Get the broker to explain how each loan option works, what it costs and why it's recommended to you. If you are not happy with any option, ask the broker to find an alternative.

You don't have to take the first loan you're offered. You may have a preference for a particular lender, such as your current bank. Ask to see loans from other lenders as well, so you can compare.

A home loan is a long-term debt, so even a small difference in interest adds up over time. If you can get a lower interest rate from another lender, you could save thousands of dollars.

Questions to ask your mortgage broker

Get a written quote from the broker

A written quote tells you the:

Make sure you're comfortable with what you're agreeing to. Ask more questions if there's anything you're not sure about.

Never sign blank forms or leave details for the broker to fill in later. If you feel you're being pressured into signing, ask for more time to think about the loan. Or go to another broker.

Problems with a mortgage broker

If you're unhappy with the loan advice you've received or fees you've paid, there are steps you can take.

Talk to your broker

The first step is to talk to your broker. Explain the problem and how you'd like it fixed.

Make a complaint

If the problem isn't fixed, make a complaint to your broker's business in writing. See how to complain for help with this.

If the problem is still not resolved, contact the Australian Financial Complaints Authority to make a complaint and get free, independent dispute resolution.