How To Find A Mortgage Broker

A mortgage broker works with lenders to help you secure the right loan, and is required by law to act in your best interests. But that doesn’t mean every broker will be a good fit for you. Learn how to find the right mortgage broker and what questions to ask.

It’s important to find the right mortgage broker for you, especially if you’re a first-time home buyer and unsure of how the process works. Here are four ways to find a mortgage broker in your area.

Ask a real estate agent.

If you’re using a real estate agent to find your new home, they may be able to recommend brokers in your area.

Search the MFAA database.

The Mortgage & Finance Association of Australia (MFAA) is one of Australia’s major associations for mortgage and finance brokers.

Search the FBAA database.

The Finance Brokers Association of Australia (FBAA) is another major association for mortgage and finance brokers in Australia.

Get a word-of-mouth referral.

Ask family members or friends in your area if they’ve used a broker that they recommend.

Using a mortgage broker in the MFAA or FBAA

In general, lenders require brokers to be members of the MFAA or FBAA to do business with them, so it’s a good place to start your search. Both organisations impose strict requirements to join, and offer continuing professional development, such as mentorship for new brokers.

Using a real estate agent as a mortgage broker

Real estate agents can perform mortgage broker tasks and vice versa, so it might seem advantageous to combine the roles. In reality, however, there is the potential for conflict of interest, so it’s a good idea to keep the financing step separate.

Check the mortgage broker’s qualifications

Before you begin your search, you should compile a short checklist of what to look out for, starting with qualifications and experience.

Certifications: At the very least, the broker must be a qualified professional with a Certificate IV in Finance and Broking, the minimum qualification required in Australia. To be a member of the MFAA, brokers must also obtain a Diploma in Finance and Mortgage Broking Management.
Accreditations: They must also be registered with the Australian Securities and Investment Commission (ASIC) as a Credit Representative or a Credit Licensee. To search ASIC Connect’s Professional Registers, simply enter the broker’s name. You can also check that they belong to either the MFAA or FBAA at the same time.
Reviews: Once you’ve established your broker’s accreditations and qualifications, check for any negative reviews or complaints about the broker online. Or any positive reviews, for that matter.

Things to ask a mortgage broker

When you find a mortgage broker you want to work with, it’s worth learning more about their practice and processes.

Here is a list of questions you should ask your broker when you meet.

What types of lenders and loans do you have experience with?

Ask them whether they work with lenders that offer unconventional loans, such as low-documentation or interest-only, if your situation requires it, and how they decide what type of mortgage is best for you.

What fees, if any, will you charge me for your services?

Mortgage brokers generally get paid commissions by the lender and don’t charge the buyer for their services. But you’ll want to be aware of any charges from the outset.

What are the fees for taking out a mortgage?

The cost of buying a house goes beyond just the price tag. There are various fees associated with a mortgage, and it’s important for a broker to itemise each one so there are no surprises when payment is due.

What are my options if I don’t have a 20% deposit?

Your mortgage broker should provide you with options that are in your best interest. This may include saving for the 20%, taking advantage of first-time home-buyer schemes, or using a guarantor to avoid paying lenders’ mortgage insurance.

How much can I borrow?

Your mortgage broker can help you understand how much you can borrow and do the maths with you. You also can use the government’s moneysmart mortgage calculator to get a rough estimate.

Am I better off with a fixed or variable rate loan, and over what term?

A good mortgage broker will be on top of all the best rate-related mortgage products and should be able to provide you with the best option.

Is the loan you recommend the cheapest, and if not, what features am I paying for?

A broker may not necessarily recommend the cheapest possible mortgage, so you’ll need to check the rationale for that and any features that could benefit you in the long term.

Can I get a quote?

You can obtain a written quote from the broker, which details: the type of loan, the amount, the loan terms, the interest rate (fixed or standard variable), and the fees associated with the mortgage.

🤓 Nerdy Tip

If you have ongoing issues with your mortgage broker, you can submit a complaint to the Australian Financial Complaints Authority, which offers free and independent dispute resolution.

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