What Does a Mortgage Broker Cost in Australia?

The most common question we hear — and the answer surprises people: for the vast majority of home loans in Australia, a mortgage broker costs you nothing.

How Brokers Are Actually Paid

When your loan settles, the lender pays the broker a commission: typically an upfront commission of around 0.65% of the loan amount, and a small ongoing "trail" commission of about 0.15% per year. This comes from the lender's margin — it is not added to your interest rate or fees. You'd pay the same rate walking into that bank directly; the bank simply keeps the commission instead.

Does Commission Bias the Advice?

Australian law directly addresses this. Since 2021, mortgage brokers operate under a legislated Best Interests Duty — a legal obligation to act in your best interests, with penalties for breaches. Bank staff have no equivalent duty. Commission rates are also broadly similar across lenders, which removes most of the incentive to steer.

At Wiseman Financial we disclose our commission on every loan, in writing, before you proceed.

When Might a Broker Charge a Fee?

• Very small loans (some lenders pay minimal commission below ~$150,000)
• Complex commercial or private lending deals
• Specialist scenarios where the work is extensive and lender commission doesn't apply

In every case, any fee must be disclosed and agreed in writing before work begins. For standard home loans, refinances and investment loans, our service is free.

The Real Cost Comparison

The question isn't broker vs. free — it's broker vs. going alone. Choosing a lender blind from 40+ options, or accepting your existing bank's loyalty-tax rate, routinely costs borrowers thousands per year. A 0.30% rate difference on a $700,000 loan is about $2,100 every year.

The Regulation Behind the "Free"

Broker remuneration in Australia isn't a handshake arrangement — it's a regulated regime. Following the Banking Royal Commission, the Best Interests Duty came into force under ASIC oversight in 2021, alongside a ban on conflicted remuneration. Commission structures are standardised enough across lenders that steering for commission makes little economic sense — and breaches carry civil penalties. You can verify any broker's credentials on ASIC's professional registers, and Wiseman Financial operates as a Credit Representative of NMB Pty Ltd under ACL 391209.

What You Actually Get for $0

A typical engagement includes: a borrowing capacity assessment across multiple lender calculators (they differ by six figures — see our Borrowing Capacity Calculator for a starting estimate), a policy match of your income type against 40+ lender policies, rate negotiation with pricing desks, application packaging and lodgement, valuation ordering, and settlement coordination with your conveyancer. Post-settlement, trail commission funds annual reviews and repricing requests — the maintenance most direct borrowers never do, and the reason bank loyalty quietly costs 0.3–0.6% (our refinance-or-stay guide shows the maths).

Questions Worth Asking Any Broker

How many lenders are on your panel? Will you disclose your commission in writing? (Required — but ask anyway.) What happens at annual review? Do you charge fees on any scenario? A quality broker answers all four without flinching. For complex scenarios — self-employed income, credit issues, bridging — the value gap between a good broker and going direct widens dramatically, because policy knowledge is the whole game. Moneysmart's broker guidance offers a neutral checklist worth reading before choosing anyone, including us.

The Clawback Question Nobody Asks

One structural detail worth knowing: if a loan is repaid or refinanced within (typically) two years, the lender claws back some or all of the broker's upfront commission. Borrowers sometimes worry this creates pressure to keep them in loans; in practice it cuts the other way — brokers under Best Interests Duty must still recommend a better deal when one exists, clawback or not, and reputable brokers simply absorb it as a cost of doing business. What clawback does explain is why brokers invest in getting the lender right the first time rather than churning clients between banks for commission — the economics reward durable, well-matched loans. It also explains why broker-originated loans statistically perform well: the incentive structure, post-reform, genuinely aligns with the borrower staying happily in a suitable loan. Ask any prospective broker how they handle clawback; a straight answer is another good filter. Ours: it never changes the advice, and our reviews reflect that.