What is a Mortgage Broker?

Mortgage Brokers are essentially the liaison between the customer and the lender. They are responsible for assessing your financial needs and determining which lender and product would be best suited to you. Throughout this process, a good Mortgage Broker will also maintain frequent communication with the customer.


What is the difference between a Mortgage Broker and a Lending Manager?

The key difference between a Mortgage Broker and a Lending Manager is the range of products and home loans that they can offer you. Mortgage Brokers work on your behalf and have access to a vast array of lending institutions. This allows them to find the best lender and product, specific to your needs, wants and circumstances. Here at Zebra Financial, we are accredited with over 25 lending institutions, which means that we have access to all of their products. On the other hand, Lending Managers work on behalf of the bank and therefore, can only provide you with the products that their specific bank has to offer.


How are Mortgage Brokers paid?

Mortgage Brokers receive a commission from the lender upon the settlement of each loan. However, it is important to recognise that Mortgage Brokers are not employed by the banks. The commissions received by brokers are essentially payment for the services that the Mortgage Broker has provided to the client.

Some Mortgage Brokers also charge their clients a fee for their services. These fees are disclosed to the clients before commencement. However, here at Zebra Financial, we do not charge a fee for our services. Our sole payment is received from the lender. This means that our services come at no additional cost to you.


What are the benefits of using a Mortgage Broker?

Seeking a loan through a Mortgage Broker offers many benefits. First, using a Mortgage Broker broadens the range of lenders and loan products that are available to you. This means that we can ensure that the loan selected for you, is best suited to your needs. Access to this variety of lenders also means that, in the case that your loan is not approved with one bank, your Mortgage Broker can recommend an alternative lender.

Secondly, a Mortgage Broker works with your best interests at heart to create a professional and meaningful relationship with their clients. In many cases, Mortgage Brokers go above and beyond to assist and guide you through the process of getting a loan. Additionally, your Mortgage Broker is your first point of contact regarding any questions you may have regarding your loan, or the process itself.

Lastly, if your circumstances are particularly complicated or unique, a Mortgage Broker can help you find the best solution to your lending needs. Examples of such complex circumstances include self-employment, poor credit or previous defaults or judgements.


Can a Mortgage Broker help if I need business finance or a commercial loan?

Different Mortgage Brokers have different expertise. That is why, when selecting a Mortgage Broker, it is important that you select one with the appropriate expertise and experience. With regards to business finance, or commercial loans, there are specific Mortgage Brokers that have such expertise. Other Mortgage Brokers on the other hand, may not. Therefore, it is important that you are careful when selecting your Mortgage Broker.


Can Mortgage Brokers provide financial advice?

Beyond recommending you a lender or loan product, Mortgage Brokers generally cannot provide you with financial advice. As Mortgage Brokers, they only hold an Australian Credit Licence (ACL), which prohibits them from providing financial advice such as self-managed superfunds or investments. However, if you are in need of financial advice, it is recommended that you speak with a Financial Adviser, who holds an Australian Financial Services Licence (APSL).


Don’t Mortgage Brokers have a reputation for being ‘dodgy’?

The 2007/2008 Global Financial Crisis was a product of the poor assessment of Home Loans. Whilst banks were considered to be the primary culprits, there was a small portion of the Mortgage Brokering industry that was involved. Brokers had become incentivised by banks to submit loan applications that were questionable in terms of their suitability for clients.

However, following this worldwide crisis, the financial services industry underwent massive changes to ensure that such practices were eradicated from the industry. This involved banning kickbacks and incentives, reducing the commissions received and establishing associations such as the Mortgage and Finance Association of Australia (MFAA) or the Finance Brokers Association of Australia (FBAA).