Can you be your own mortgage broker?

Any Australian who thoroughly researches the home loan market and carefully compares mortgage offers could effectively serve as their own mortgage broker. But while there may be some advantages to being your own broker, there are also potential benefits from getting a mortgage broker’s help with your home loan application.

Can mortgage brokers write their own loans?

Professional mortgage brokers may not be able to act as their own brokers. Some banks don’t allow brokers to self-submit mortgage applications for their own personal use, where the broker is the applicant or one of the applicants. This is so the banks can maintain their regulatory requirements and responsible lending commitments.

What do mortgage brokers do?

Mortgage brokers are home loan experts who can recommend mortgage deals that may best suit your financial situation. They can negotiate with lenders to help you get a lower interest rate, or access to other features and benefits that may help you achieve your financial goals. Brokers can also manage the home loan application process on your behalf, taking care of much of the paperwork so that you don’t have to. 

But researching the mortgage market, understanding your own financial circumstances, and familiarising yourself with the home loan application process could effectively allow you to act as your own mortgage broker, and handle every step of your home loan application, from inquiry to settlement. 

What are the benefits to being your own broker?

Choose from more lenders

Most mortgage brokers in Australia don’t compare every home loan on the market when working out the best options for you. Instead, they compare options from a select portfolio of lenders. While these lenders often offer a wide range of home loan choices, there will almost always be more options out there that could be worth considering.

By doing your own research, you may be able to find home loan offers from smaller banks, non-bank lenders, and other providers with rates, fees, features and benefits that suit your needs. Some of these lenders may not appear in a broker’s portfolio, so you may be able to choose from a wider variety of options by going it alone.

Avoid potential conflicts of interest

Brokers are paid commissions by banks when they refer new customers to them. While mortgage brokers are obliged to act in the best interest of their customers, it’s possible that a broker could still recommend a lender based not on the benefits of their mortgages, but how much they’d pay the broker. 

A good broker should be able to clearly explain how their commissions from different lenders work to help clear up any doubts you may have. But if you’re still concerned, you could consider taking care of your own home loan search and application.

Not all brokers are created equal

Just like how it's important to research different banks and mortgage lenders, it’s also important to compare different mortgage brokers. While brokers are expected to maintain professional standards, not all brokers offer the same level of education and experience. Also, different brokers may have different loan books, affecting the home loan options they may be able to provide.

It may be worth looking up a broker’s reviews or testimonials before setting up a meeting, to get a better idea if they may be a good fit for your needs. As well as online reviews, you could look for word-of-mouth recommendations from your family, friends, colleagues or others in the community to learn more about their experiences with the broker.

What are the benefits of using a mortgage broker?

Access to exclusive deals 

Mortgage brokers often have a different level of access to banks and mortgage lenders than everyday customers. Rather than applying through the usual customer channels, a broker may be able to directly contact a bank’s mortgage team to negotiate on your behalf before submitting your application.

Brokers may also know about special home loan deals that the banks don’t typically advertise, which may be exclusive to mortgage brokers. These deals may be ideal for borrowers in some financial situations.

Expert knowledge for unusual situations

If your finances are relatively straightforward, you may be able to apply for a home loan or refinance a mortgage on your own without too much trouble. But if your financial situation is a bit unusual, you may run into issues that could slow down your mortgage application’s approval, or even see it declined.

For example, you may be self-employed or a contractor, and can’t provide payslips to prove your income. You may have a bad credit history, or may be looking to buy a property with a small deposit. Some professionals may also have specialist needs for a home loan, such as structuring a mortgage to help protect assets, and may be eligible for extra features and benefits that you may not be aware of.

Mortgage brokers can use their expertise and specialist knowledge of individual lender requirements and eligibility criteria to help you find a mortgage that will match your unique financial position. This can help to save you time and effort on research and unsuccessful applications, and may let you benefit from more useful home loan features.

Free to use

Because most mortgage brokers in Australia are paid commissions by banks rather than charging fees to customers, it usually doesn’t cost you anything to visit a mortgage broker. A few brokers charge fees to their customers rather than taking commissions, but these are the exception to the rule.

Brokers are paid by banks but work for customers. While a risk of conflicts of interest remains, brokers are obliged to act in the best interest of their clients. A broker may be paid the same commission from a bank even if they negotiate a discount for you, so it’s often in the broker’s interest to get you the best possible deal for your circumstances. 

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