How to choose a mortgage broker

Here’s what to consider when deciding on a broker:

1. Decide what’s most important to you

   Do you want a broker who has many years of experience or would you be happy with someone just starting out? Does the broker need niche expertise, or are you happy with a generalist? Do you want to be able to meet them near work or home, or would you consider someone outside your local area? Do you need your broker to help with other steps in the buying process (e.g. buyer’s advocacy, conveyancing) or more broadly (e.g. financial planning)? Once you’re clear on which factors are most important to you, it’s time to start browsing.
   
   

2. Ask friends and family for recommendations

   A personal recommendation can be an excellent way to start compiling your shortlist. Keep in mind that your circumstances, needs and preferences may be different to the person making the recommendation and that what works for your friends and family may not work for you.
   
   

3. Do your own research and read what other customers say

   Now it’s time to investigate any brokers you’ve been recommended and start browsing who’s out there. You can search by area of expertise and location. Read what other customers – especially those in your situation – are saying about the broker you’re researching. If you’re on tight timelines, you’ll want a broker who consistently puts in the effort with their customers. If your situation is somewhat tricky, you’ll want someone with proven expertise in your scenario. Perhaps you want someone who really cares about their customers on a personal level, in which case you can look out for how they score against our ’empathy’ metric.
   
   

4. Find out which aggregator they belong to

   Aggregators (sometimes known as franchisors) are the companies that act as the go-between the lender and the broker. They negotiate the terms with the lenders, provide the required software and provide varying levels of marketing and administrative support to the broker. They take a cut of commission and may also charge ongoing fees. Many aggregators are owned by the banks. There is also a trend towards consolidation, with smaller aggregators being acquired by larger aggregators – but continuing to operate under separate brands.
   
   

5. Look into which lenders are on their panel

   The panel of lenders is essentially the list of lenders the broker can choose from to recommend you a suitable loan product. Most brokers will have at least 25 lenders on their panel.
   
   

6. Confirm that the broker is accredited

   Mortgage and finance brokers need to either be authorised Credit Representatives or the employee of an Australian Credit License (ACL) holder. They also need to belong to an industry association:
   These associations are:
   – Commercial & Asset Finance Brokers Association (CAFBA)
   – Finance Brokers Association of Australia (FBAA)
   – Mortgage and Finance Association of Australia (MFAA)
   A condition of belonging to these industry associations is to complete 25-30 hours of professional development each year, so you can be more confident in your broker’s up-to-date expertise.
   All the brokers listed on Brokermatch.com.au are accredited.
   
   

7. Get in touch with your shortlist

   If you’re still undecided, you can contact the brokers on your shortlist to find out more about them and decide whether you’ll like working with them on your loan application. This first contact will also give you a good idea of how responsive they are as well as their communication style.