Last reviewed September 2026 by Megan Birot, Content Editor, OurTop10. Figures checked against the sources named in the article.Four out of five new home loans in Australia are now written through a mortgage broker rather than a bank branch. That did not happen because brokers advertise well. It happened because the lender panel a broker works from is wider than any one bank’s product list, because the broker is legally required to act in your interests, and because the lender pays them rather than you.
This guide sets out what a broker actually does, the five places they earn their keep, and the two situations where going direct to a bank is the better call.
Table of Contents
What a mortgage broker is
A mortgage broker is a licensed intermediary who arranges a home loan for you from a panel of lenders. In Australia a broker has to hold, or work under, an Australian credit licence, be a member of an external dispute resolution scheme, and comply with the best interests duty, which has applied since January 2021 and requires them to recommend the loan that suits you rather than the one that pays them most.
A typical broker’s panel runs to 30 or more lenders: the big four, the second-tier banks, the mutuals and credit unions, and the non-bank lenders that most borrowers have never heard of. Some of those lenders do not deal with the public directly at all. Broker-only access is one of the reasons the channel has grown the way it has.
The five things a broker does that a bank will not
1. Tests your scenario across a panel before anything is lodged
A bank assesses you against its own policy and says yes or no. A broker runs your income, debts and deposit through the policies of 30 lenders before a single application goes in, and tells you which ones will say yes and at what amount. On the same file the gap between the most and least generous lender on a panel is commonly $100,000 or more, because each one counts overtime, bonuses, rental income, credit card limits and HELP debt differently.
That also matters for your credit file. Every formal application leaves an enquiry on it, and a cluster of enquiries reads badly. Applying to the right lender once beats applying to three banks and hoping.
2. Finds a lender for the file that is not straightforward
Eight months in the job. A gifted deposit. Casual or contract income. Self-employed with one year of returns. A default from a phone bill three years ago. A HELP balance that halves your borrowing power. Each of those has lenders who will take it and lenders who will not, and the difference is not written on any bank’s website. Knowing which is which is most of what a broker is for.
3. Prices the loan, not just the rate
A broker can usually get a rate below the lender’s advertised one, because lenders price for broker volume. But the sharper work is in the structure: whether a full offset account is worth a slightly higher rate on your numbers, whether to split between fixed and variable, whether a package fee pays for itself, and how to set the loan up so a future investment purchase does not need a full refinance. Read our guide to fixed vs variable for how that decision works.
4. Runs the application and the settlement
The broker lodges the application, chases the lender, handles the valuation, answers the credit officer’s questions, applies for the First Home Owner Grant where it applies, and works with your conveyancer to get to settlement on time. When something goes sideways, which on a home loan it often does, you have one person to ring who already knows the file. Our guide to home loan pre-approval covers what that process looks like from your side.
5. Keeps working after settlement
A broker is paid a small trail commission for as long as the loan runs, which gives them a reason to keep it. A good one reprices your rate against what the lender offers new customers every year or so, moves you when the lender stops competing, and structures the next purchase. Your bank has no equivalent incentive: the standard variable rate exists because most borrowers never ask.
What a broker costs you
Usually nothing. The lender pays the broker an upfront commission when the loan settles and a trail commission each month it runs, and neither is added to your rate or your loan. A small number of brokers charge a fee for complex files, and they must tell you before you engage them. How the commission works, what the numbers are, and why it does not push you towards a dearer loan is covered in our guide to how mortgage brokers get paid.
When going direct to a bank is the better call
Two cases. If you already bank with a lender, have a clean, simple file and want one of that lender’s own products, applying direct can be quicker and the outcome will be the same. And if you are refinancing a small balance where the difference in rate is a few dollars a month, the broker’s time is not going to change much.
Everyone else, and anyone with a file that has a wrinkle in it, gets a better answer from a panel than from a branch.
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How to choose one
- Check the credit licence or representative number on ASIC’s register
- Read the Google reviews for how they handled problems, not just the five stars
- Ask how many lenders are on the panel and which ones they actually use
- Ask whether they charge a fee, and get the answer in writing
- Ask what happens after settlement, and whether anyone reviews your rate
Our ranked lists do most of that vetting for you. The brokers on the Sydney, Melbourne and Brisbane lists hold current 2026 awards and verified reviews, and each listing carries their contact details and a booking link. First home buyers should also read whether a first home buyer needs a broker, which goes through the government schemes a broker applies for on your behalf.
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FAQs
Do I pay a mortgage broker?
Usually not. The lender pays the broker a commission when the loan settles and a trail while it runs. A few brokers charge a fee on complex files and must disclose it before you engage them.
Is a broker’s rate better than the bank’s?
Often, because lenders price for broker volume and a broker can compare 30 lenders rather than one. The bigger saving is usually in structure and in being matched to a lender whose policy suits your file.
Are mortgage brokers required to act in my best interests?
Yes. The best interests duty has applied to brokers since January 2021. Banks selling their own loans are not under the same duty.
How many lenders does a broker have access to?
Typically 30 or more, including banks, mutuals and non-bank lenders. Some lenders only accept applications through brokers.
Can a broker help if the bank has already said no?
Frequently. A decline at one lender is often a policy mismatch rather than a verdict on you. Another lender may accept the same file.
How do I check a broker is licensed?
Search their name or their licence number on ASIC’s professional registers. Every legitimate broker holds an Australian credit licence or is an authorised representative under one.
Megan Birot
Content Editor, OurTop10
Megan Birot is OurTop10’s Content Editor. She holds a Certificate IV in Finance and Mortgage Broking (FNS40821) and checks every guide on the site against current lender policy, government scheme rules and state revenue office thresholds before it goes live.
She also runs the editorial reviews on OurTop10’s broker, accountant, conveyancer and buyer’s agent shortlists, and writes the media releases for its quarterly mortgage stress research.