Key takeaways
- Most brokers are paid by the lender, not the borrower, so the service is usually free to you.
- Lenders pay commission when the loan settles, and brokers must disclose it before you commit.
- A fee may apply in some situations, such as complex commercial deals. You should know it upfront.
- Brokers must act in your best interests under Australian law.
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Do you pay a mortgage broker?
Usually not. In almost every home loan, the lender pays the broker a commission once the loan settles. You don't pay us for the comparison, the application or the support through to settlement. Lenders generally offer the same rates through brokers as they do direct, and the commission is paid by the lender, not added to your loan.
When might a fee apply?
Some brokers charge fees for complex deals, specialist lending, commercial finance or where a loan is repaid very soon after settlement. If a fee ever applied to your situation at LendQuest, you'd know the exact amount in writing before we did anything. In most home loan, refinance and car loan cases there's no fee.
What does the lender pay?
Most lenders pay an upfront commission based on the loan amount when it settles, and a smaller ongoing trail commission while the loan remains open. The details are disclosed to you in writing before you proceed. See how mortgage brokers are paid.
Is the advice biased by commission?
Since 2021, mortgage brokers have been required by law to act in the best interests of their clients and to prioritise your interests when there's a conflict. Commission rates are broadly similar across the major lenders, and volume-based commissions and bonuses are banned, which reduces the incentive to favour one lender. You're entitled to ask why a loan was recommended and what alternatives were considered.
Questions to ask any broker
- How many lenders are on your panel?
- Will I pay any fee, and in what circumstances?
- What commission will you receive on this loan?
- Why is this loan better for me than the alternatives?
- What happens after settlement? Will you review the loan?
Broker or bank?
Going direct means one lender's products. A broker compares many and handles the paperwork. For a full comparison, see mortgage broker vs bank.
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Frequently asked questions
Is a mortgage broker free in Australia?
For most home loans, yes. The lender pays the broker a commission when the loan settles.
Will I get a worse rate through a broker?
No. Lenders offer brokers the same rates as direct customers, and brokers can often access lenders you can't approach directly.
Do brokers have to disclose commission?
Yes. Commission must be disclosed before you commit to the loan.
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This guide is general information only and does not take your personal circumstances into account. It is not financial, credit, tax or legal advice. Examples are illustrative only. Government schemes, lender policies and rates change over time and eligibility criteria apply. Speak with us for advice tailored to your situation. LendQuest Pty Ltd is a credit representative (555514) of BLSSA Pty Ltd, Australian Credit Licence 391237.