Australian homebuyers are increasingly turning to mortgage brokers in record numbers, as opposed to going directly to their bank, according to the latest data from the Mortgage & Finance Association of Australia (MFAA).
In the September 2024 quarter, mortgage brokers facilitated 74.6% of all new home loans – the highest market share ever recorded. The total value of loans written by brokers also reached an all-time high of $103.2 billion, marking a 10.02% increase ($9.4 billion) compared to the same period last year.
MFAA CEO Anja Pannek attributes the growing reliance on mortgage brokers to an increasingly complex lending environment:
“This result reinforces that mortgage brokers are the preferred choice for borrowers navigating today’s home loan market. Brokers provide personalised guidance and support, empowering borrowers to make informed financial decisions.”
Mortgage broker market share grew by 3.1 percentage points compared to the September 2023 quarter.
Ms. Pannek said this sustained growth was due to the trust and value brokers bring to their clients:
“Australians continue to choose mortgage brokers because of the strong relationships they’ve built and the broad support they provide. It’s not just about securing a competitive interest rate—brokers help borrowers understand their financial options, adjust household budgets, and find tailored solutions to meet their needs.”
The role of mortgage brokers extends beyond borrowers, also serving as a crucial distribution channel for lenders.
“MFAA data highlights the indispensable role mortgage brokers play, not only for borrowers but for lenders as well,” Ms. Pannek added. “This record market share reinforces that brokers are at the core of Australia’s home lending system, driving access, competition, and personalised solutions in a dynamic and evolving landscape.”
More options in your best interest
Several key factors have contributed to the rising dominance of mortgage brokers in the Australian home loan market:
- Consumer Trust and Preference: The increasing market share indicates a strong consumer preference for brokers, who often provide personalised service and guidance throughout the loan process.
- Regulatory Reforms: The introduction of the Best Interests Duty requires brokers to prioritise their clients’ interests, ensuring that consumers receive loan products best suited to their needs. This regulatory framework has enhanced the credibility and appeal of using brokers.
- Market Competition and Innovation: The presence of brokers has intensified competition among lenders, leading to more innovative and tailored loan products. This competition benefits consumers by providing more choices and potentially better loan terms.
Why do people choose a mortgage broker over the bank?
Choosing a mortgage broker over going directly to a bank in Australia comes down to several key advantages that brokers offer:
1. Access to More Lenders & Loan Options
Mortgage brokers work with multiple lenders, including major banks, smaller lenders, and non-bank lenders. This means they can compare dozens of loan products and find the one best suited to your needs, rather than being limited to the single range of products offered by one bank. At Base Home Loans, we have access to a panel of over 80 different lenders that we can use to find you the most suitable home loan product for your needs.
2. Better Interest Rates & Negotiation Power
Since brokers handle a high volume of loans, they often have access to better rates or special deals that may not be available or known to the general public. They can also negotiate on your behalf to secure a lower interest rate or better loan terms.
3. Expert Advice & Personalized Service
Banks only offer their own products and may push loans that benefit them rather than you. A broker is legally required to act in your best interest (due to the Best Interests Duty law), meaning they assess your financial situation and help you choose the best mortgage option.
4. Convenience & Time-Saving
A mortgage broker does all the legwork – researching loans, comparing lenders, completing paperwork, and handling the application process – saving you time and reducing stress. Instead of visiting multiple banks, a broker brings all the options to you in one place.
5. Help for Borrowers with Complex Situations
If you’re self-employed, have a lower deposit, or have a less-than-perfect credit history, a bank might reject your loan application outright. Brokers have access to lenders who specialise in these situations and can find a lender willing to approve your mortgage.
6. Brokers Are Often Free to Use
Most mortgage brokers in Australia do not charge you directly for their service. Instead, they receive a commission from the lender when your loan is approved. However, they must disclose how they are paid, ensuring transparency.
7. Post-Settlement Support
A good broker provides ongoing assistance even after your loan is settled, helping you with refinancing, reviewing your loan if interest rates change, or answering any mortgage-related questions over time.
Based in Perth, Base Home Loans is a trusted mortgage broking service dedicated to helping Australians secure the best home loan solutions tailored to their needs. With access to a wide range of lenders, we simplify the loan process, negotiate competitive rates, and provide expert guidance every step of the way. We always prioritise your financial goals, offering personalised support to help you make informed decisions. Whether you’re a first-home buyer, refinancing, or investing, Base Home Loans makes securing the right loan easy, stress-free, and rewarding. We can also help with other loans like car loans, business loans, or personal loans.
Ready to get started? Get in touch with us today or book a time for a call or to catch up when it suits.
Disclaimer: The information provided on this blog is for general informational purposes only and does not constitute financial or professional advice. While we strive to provide accurate and up-to-date information, mortgage laws and regulations can change, and individual circumstances may vary. We recommend consulting with a qualified financial advisor or mortgage broker to assess your specific situation and needs. Base Home Loans is not responsible for any actions taken based on the content of this blog. Always conduct your own research and consider seeking professional advice before making financial decisions.
