A mortgage broker compares home loans from a range of lenders, helps you work out which options suit your situation, and manages the application from start to settlement. In Australia, brokers are legally required to act in your best interests, and most (including us) are paid by the lender rather than charging you a fee.
If you’ve ever wondered what actually happens behind the scenes when you “talk to a broker”, grab a cuppa. Here’s the full picture.
- Getting to know you. Your income, spending, goals, and what you want your loan to do for you.
- Working out your borrowing power. Every lender calculates this a bit differently, so we look at several.
- Comparing loans. We search across our panel of lenders for options that fit your needs, not just the one with the flashiest ad.
- Explaining the trade-offs. Features, fees, rates and risks, in language that doesn’t need a dictionary.
- Handling the paperwork. We prepare and lodge your application and chase it through to approval.
- Following up after settlement. Your loan should keep working for you, so we check in over the years.
What does a mortgage broker do day to day?
Think of us as your home loan tour guide. Instead of you visiting bank after bank, filling out the same forms and hoping for the best, we do the legwork. That usually looks like:
What’s the difference between a broker and going straight to a bank?
A bank lender can only offer you that bank’s products. A broker can compare products from a panel of lenders, which may include big banks, smaller banks, credit unions and non-bank lenders.
That doesn’t mean a broker will always find something different to what your bank offers. Sometimes your existing bank is the right fit. The point is that you get to see how it stacks up before you commit.
Do mortgage brokers have to act in my best interests?
Yes. Since 2021, mortgage brokers in Australia have had a legal Best Interests Duty under the National Consumer Credit Protection Act. In plain English, that means we have to put your interests first when we recommend a loan, and we need to be able to show why the loan we recommended suits you.
We’re also bound by responsible lending obligations. We have to make reasonable enquiries about your situation and make sure a loan isn’t unsuitable before we recommend it. That’s why we ask lots of questions. We’re not being nosy, promise.
How do mortgage brokers get paid?
Here at Rhythm, we don’t charge you any fees for our home loan services. Instead, the lender pays us a commission once your loan settles, and often a small ongoing commission while the loan is active.
Commissions are disclosed to you in writing before you proceed, so you can see exactly how we’re paid. Because we’re bound by the Best Interests Duty, the commission a lender pays can’t be the reason we recommend a loan.
When is a broker most useful?
Pretty much any time you’re dealing with a home loan, but we tend to make the biggest difference when:
- You’re buying your first home and want to understand government schemes and costs.
- You’re self-employed or have income that’s a bit less straightforward.
- You want to refinance and see whether your current loan still fits.
- You’re buying your next home or an investment property and need the structure right.
- You simply don’t have the time to compare lenders yourself.
What should I bring to my first chat with a broker?
Nothing fancy. A rough idea of your income, debts and savings is enough for a first conversation. Once you decide to go ahead, we’ll ask for things like payslips, bank statements and ID, and we’ll give you a checklist so nothing’s missed.
The Rhythm way
We’re a family-owned team of locals here on the Coffs Coast, and we keep things real. No jargon walls, no pressure. Just honest guidance so you can make your own decisions with confidence.
Ready to have a chat? Get in touch with Team Rhythm and let’s get your finances grooving.
FAQ
Is it free to use a mortgage broker? At Rhythm Finance Co we don’t charge fees for our home loan services, as the lender pays us a commission. Some brokers do charge fees, so it’s always worth asking.
Can a broker get me a better deal than my bank? It depends on your situation. A broker can compare options from a panel of lenders, which gives you a broader view, but your current bank may still be the right choice.
Are mortgage brokers regulated? Yes. Brokers must hold an Australian Credit Licence or be authorised as a credit representative, and they must meet the Best Interests Duty and responsible lending obligations.
This article provides general information only and has been prepared without taking into account your objectives, financial situation or needs. Before acting on it, consider whether it’s appropriate for your circumstances. Your full financial situation will need to be reviewed before acceptance of any offer or product. It does not constitute legal, tax or financial advice. Lending criteria, fees and charges apply. Rhythm Finance Co Pty Ltd (Credit Representative 532711) is authorised under Australian Credit Licence 389328.