Do mortgage brokers get you a better rate than banks?

Mortgage brokers often can't get you a better rate than if you were to go direct to a lender, but it depends. Brokers generally have access to a panel of around 30 lenders. These panels won't have a lot of the smaller online lenders who offer the cheapest loans, but the panels will differ between brokers. You could compare home loans yourself across a larger number of lenders to find yourself a better deal. However, not every borrower is eligible for a bank's lowest rate. It might be that your mortgage broker, who knows the banks' appetites, can find the lowest rate available for your situation or negotiate a bank's rate.

Can a mortgage broker give you pre-approval?

Yes, a mortgage broker can help you apply for pre-approval. Brokers will also know the banks that do and do not offer pre-approval, as well as how fast they can provide it - which can be crucial if you're coming up to auction.

How much does a mortgage broker cost?

Mortgage brokers typically don't charge a fee to borrowers. They are instead paid by commission from the banks, with both an upfront commission and a smaller ongoing commission through the life of the loan. However, there are some mortgage brokers who have chosen to charge a fee to borrowers instead of receiving a commission. Brokers may also charge fees if the borrower situation requires more work in certain complex situations.

Mortgage broker vs bank

A mortgage broker can give you home loan options from a panel of lenders and help you with the application too. And their services are free.
But you can compare options from your bank, and lenders from across the market. You can often find a lower rate this way too.
If you're in a hurry or have a complicated borrowing situation, a mortgage broker is very helpful. But you can definitely find a great loan by yourself.

Getting a home loan via a mortgage broker versus a bank

Mortgage brokers are a popular service for Australian borrowers. MFAA data shows 76% of all new home loans are settled through a mortgage broker.

Brokers are convenient, helpful and usually free to borrowers. But comparing options from bank and lenders yourself isn't hard. And you can find a lower rate without too much hassle.

The pros and cons of using a mortgage broker

Pros

Using a broker is free. Mortgage brokers are paid commission from the bank and usually don't charge fees to the borrower (some brokers might charge for more specialist cases).
Fast loan approval. A good broker knows the nuances of lenders' credit policies, and can find you a really suitable lender. The broker advocates on your behalf and guides you through the application, increasing your chances.
Expert help. If you're buying an unusual property, have a small deposit, are self-employed or have multiple loans, a broker can really help you find a lender to suit your needs. It's much harder on your own.
It's easier. Having a mortgage broker run you through the home loan process makes life easier and takes some of the stress out of buying a home.

Cons

Fewer options to compare. Brokers have access to a panel of lenders (usually around 30). This includes the big banks, but not every smaller online lender. These are the lenders which often have the best home loans.
You have to pick a broker. While a broker does a lot of work comparing home loans for you, you have to do the legwork to find a good broker. Because there's plenty of them, and some are better than others.
Commissions can influence your broker. While using a mortgage is free, it's hard to know how much your broker is influenced by the commissions they get from different banks.

The pros and cons of using a bank

Pros

More loans to compare. You can look at rates from more than 100 lenders, compared to a mortgage broker who has access to around 30 lenders.
You could find a lower rate. You might find a great rate from a small online lender which doesn't feature in a broker panel.
Banks have lending specialists. Mortgage brokers offer a very personalised service, but banks and lenders also have specialised to guide you through the application process.
Loyalty can pay. The bigger banks have a wide range of home loan products, and it's very convenient to get a loan with your current bank.

Cons

You have to do more legwork. With the DIY approach you have to compare home loans, do more research and figure out what you need without any help.
Applications can be confusing. A mortgage broker guides you through every stage of the loan application. Some people find it stressful to do this themselves.
Approval might take longer. Brokers have a good sense of which bank can handle your application fast. That's often very useful when your settlement deadline is approaching fast.
Higher chance of rejection. If you're self-employed or have bad credit, a lot of banks are unlikely to approve your application.

Which is better: mortgage broker or bank?

Deciding whether you want to use a mortgage broker or go straight to a bank is really up to you.

A mortgage broker is a great option if you:

Aren't sure if you can find the best rate for yourself.
Are confused by the whole process.
Need a home loan quickly.
Have a complicated borrowing situation.

If you can spend the time getting to understand home loans, comparing different options and working through the application yourself you might want to use a bank instead.

But even with a broker it's important to take some time to understand how home loans work. The more you learn the more equipped you are to find a better deal and stay on top of your loan repayments.

Video: Mortgage brokers vs direct to a bank

5:02

0:00
In the financial world, there are so many hustlers, swindlers, and con artists claiming they can save you money. Are mortgage brokers in that category, or are they actually trying to get you a better deal? In this video, we'll look at the pros and cons of going to a broker versus direct to a bank.

0:19
A mortgage broker is someone that will take into account your personal circumstances to shop around and find the best deal for you. They take out all the hassle of comparing the millions of loans that are out there. Millions was an exaggeration. There's probably a few thousand.

0:33
But they will take into account all of that your personal circumstances. They'll even do the application for you. They will hold your hand throughout the process so that you don't have to do all the nitty-gritty paperwork and all the stress day in and day out while you apply for your home loan.

0:46
So, what's the alternative to a mortgage broker? Well, going direct to a bank. And that way you compare all the options yourself. As I've said, thousands of them, and you go directly, you apply through their online portal, you fill in the application yourself, and you wait for a decision.

1:02
According to the latest research, about 76% of Australians go through mortgage brokers for their home loan. That has risen a lot over the last few years. In about 2018, it was closer to the 50% mark. And the reason that is, just because there are so many more home loans on the market than there ever have been. And it really depends on your own circumstances, how much money you're earning, whether you're earning extra income above your salary.

1:23
There are so many things to take into account. The market has just got so much more confusing and people are more time poor. So people are turning to brokers more than they ever have done. Do mortgage brokers actually save you money? They can do. The answer isn't quite as simple as one may think, but mostly yes, they can.

1:39
They have access to a range of lenders. They know these lenders through their BDMs and lending specialists. So they can very often negotiate better rates. They know the lender's appetite, so they know if you are a good match for them. They can very often get you a lower rate than you would be able to find yourself.

1:56
Having said that, brokers don't have access to every single lender. They have a panel of about 30. So, there are some cases where the lowest rate they may be able to find you is not necessarily the lowest rate on the market, but that isn't always the case.

2:10
Now, if you didn't want to go through a mortgage broker, it is fairly simple to go direct to a bank. The biggest hurdle is comparing the thousands of loans that are out there. But you can use a comparison site like Finder and use the filters to make it a smaller pool of home loans to choose from.

2:25
Once you have selected a lender, the next hurdle is to gather all the documents. You need things like pay slips, bank statements, income verification, personal identity verification, all these things and then you go through the homeland application yourself.

2:39
But the online processes now are really simple. So they should be able to guide you through. The biggest question that we get asked the most is how do mortgage brokers get paid and does that cost end up with the borrower? No.

2:50
For the most part, mortgage brokers do not charge a fee for you to meet with them. They mostly don't charge a fee for any of their services leading up to the home loan application process. Mortgage brokers mostly get paid through banks. They pay a commission, an upfront commission, and then while you're paying the loan, they'll get a smaller monthly commission throughout the life of the loan.

3:09
There are some circumstances where that isn't the case. If you have a more kind of specific, difficult, complex scenario such as you are self-employed, maybe you have an income that you receive outside of your salaried income or you're, you know, getting a specific type of investment property, they may end up charging you a fee for the document collection and the application process, but the initial appointment should always be cost-free to the borrower.

3:36
But there are still brokers out there that can charge a fee for service and that is where they will charge you an upfront fee for your appointment. Just clarify that before you have your meeting with them.

3:44
So what is better, a mortgage broker or a bank? Well, that really depends on you. If you are overwhelmed by the home loan landscape, time poor and don't have the patience to fill out the application yourself, you're confused or you have a complex lending situation, then a mortgage broker will be really helpful in that situation.

4:02
If you have a very basic home loan need, your documents are all streamlined and you have one salary, and it's simple, a bank is a good solution for you, but you just need to do all the hard work yourself in comparing and finding the right loan.

4:15
If this is not your first loan and you are refinancing, you might be thinking about whether it's worth going back to your broker or sticking with the home loan lender that you are already with.

4:25
A mortgage broker again will be able to compare more of the market and find you some great deals and help with the whole process and do some cost analysis based on whether it is worth paying the exit fees for your loan to make savings on your new loan, but also your existing lender may be able to give you a better deal for being a loyal customer.

4:41
So, it's really worth giving your lender a call, but then also seeking out a mortgage broker just in case. That is mortgage brokers versus banks in a nutshell. But to find out more, it's always worth going to finder.com.au AU for all of the information.

The mortgage broker process explained

A mortgage broker assesses your situation and your creditworthiness to develop a better picture of your chances of qualifying for a home loan.
They take your information and come up with a selection of loans for you to choose from.
You make your choice and the broker will guide you through the application process.

If you have questions about your mortgage options, contacting a broker can be very effective.

Expert insight: How a broker can help

"A broker works for the consumer; a bank is a business responsible for making profits for their shareholders. Think about it. A good broker will educate you and structure your lending to protect you and keep your options open as much as possible; a bank will structure your lending to secure and protect their position as much as possible. Understanding lending structures, knowing your options and sound financial literacy is key."

Dionne Lee

Financial coach & CEO, A Woman Inspired

Compare loans from many lenders across the market

20 of 24 results

Interest Rate p.a.	Comparison Rate p.a.	Fees	Features	Monthly Payment
Unloan Variable Home Loan Finder Award	Interest Rate 6.14%	Comparison Rate 6.05%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest20% min. equityOwner-occupier	Monthly Payment $914 per month	$1,000 Reward Finder Rewards: Join Finder then refinance an eligible home loan to receive a $1,000 digital Visa gift card. Ends 30 Nov 2026. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
IMB Budget Home Loan	Interest Rate 6.19%	Comparison Rate 6.22%	Fees Application: $449 Ongoing: $0 p.a.	Principal & Interest30% min. equityOwner-occupier	Monthly Payment $919 per month	Cashback: Get up to $4,000 cashback when buying or refinancing. Loan size criteria applies. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
P&N Bank Basic Variable Online Home Loan Offer	Interest Rate 6.08%	Comparison Rate 6.11%	Fees Application: $300 Ongoing: $0 p.a.	Principal & Interest40% min. equityOwner-occupier	Monthly Payment $908 per month	Go to site View details Compare product selectionCompare	loading
Unloan Variable Home Loan	Interest Rate 6.29%	Comparison Rate 6.20%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest20% min. equityInvestment	Monthly Payment $929 per month	$1,000 Reward Finder Rewards: Join Finder then refinance an eligible home loan to receive a $1,000 digital Visa gift card. Ends 30 Nov 2026. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
Up Home Invest Variable Rate	Interest Rate 6.35%	Comparison Rate 6.35%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest10% min. equityInvestmentOffset accountLMI	Monthly Payment $935 per month	Go to site View details Compare product selectionCompare	loading
NRMA Home Loans Variable Offset Home Loan	Interest Rate 6.19%	Comparison Rate 6.39%	Fees Application: $0 Ongoing: $180 p.a.	Principal & Interest50% min. equityOwner-occupierOffset account	Monthly Payment $919 per month	Bonus offer: Existing NRMA Insurance customers and NRMA members receive a $1,500 virtual gift card on settlement. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
Up Home Buy Variable Rate Finder Award	Interest Rate 6.20%	Comparison Rate 6.20%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest10% min. equityOwner-occupierOffset accountLMI	Monthly Payment $920 per month	Go to site View details Compare product selectionCompare	loading
Homestar Star Nova Variable Rate Home Loan	Interest Rate 6.23%	Comparison Rate 6.23%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest30% min. equityOwner-occupierOffset account	Monthly Payment $923 per month	Go to site View details Compare product selectionCompare	loading
Homestar Star Nova Variable Rate Home Loan	Interest Rate 6.33%	Comparison Rate 6.33%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest20% min. equityOwner-occupierOffset account	Monthly Payment $933 per month	Go to site View details Compare product selectionCompare	loading
Greater Bank Great Rate Discounted Variable Home Loan	Interest Rate 6.09%	Comparison Rate 6.10%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest20% min. equityOwner-occupier	Monthly Payment $909 per month	Cashback: Get up to $3,000 cashback when you apply online (80% LVR or lower). Minimum loan size of $250,000. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
P&N Bank Offset Home Loan	Interest Rate 6.42%	Comparison Rate 6.45%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest40% min. equityOwner-occupierOffset account	Monthly Payment $942 per month	Go to site View details Compare product selectionCompare	loading
IMB Fixed Rate Home Loan	Interest Rate 6.49%	Comparison Rate 6.57%	Fees Application: $449 Ongoing: $72 p.a.	Principal & Interest 3Y Fixed5% min. equityOwner-occupierLMI	Monthly Payment $948 per month	Cashback: Get up to $4,000 cashback when buying or refinancing. Loan size criteria applies. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
BCU Bank OMG Online Home Loan Offer	Interest Rate 6.09%	Comparison Rate 6.12%	Fees Application: $300 Ongoing: $0 p.a.	Principal & Interest40% min. equityOwner-occupier	Monthly Payment $909 per month	Go to site View details Compare product selectionCompare	loading
Newcastle Permanent Real Deal Home Loan	Interest Rate 6.19%	Comparison Rate 6.23%	Fees Application: $350 Ongoing: $0 p.a.	Principal & Interest20% min. equityOwner-occupier	Monthly Payment $919 per month	Cashback: Eligible purchases and refinancers can get up to $3,000 cashback depending on loan value with LVR 80% or less. Application must be completed online. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
Newcastle Permanent Real Deal Home Loan	Interest Rate 6.44%	Comparison Rate 6.48%	Fees Application: $350 Ongoing: $0 p.a.	Principal & Interest20% min. equityInvestment	Monthly Payment $944 per month	Cashback: Eligible purchases and refinancers can get up to $3,000 cashback depending on loan value with LVR 80% or less. Application must be completed online. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
IMB Fixed Rate Home Loan	Interest Rate 6.49%	Comparison Rate 6.56%	Fees Application: $449 Ongoing: $72 p.a.	Principal & Interest 2Y Fixed5% min. equityOwner-occupierLMI	Monthly Payment $948 per month	Cashback: Get up to $4,000 cashback when buying or refinancing. Loan size criteria applies. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
Bendigo Bank Express Home Loan	Interest Rate 6.14%	Comparison Rate 6.29%	Fees Application: $0 Ongoing: $120 p.a.	Principal & Interest20% min. equityOwner-occupierOffset account	Monthly Payment $914 per month	Go to site View details Compare product selectionCompare	loading
IMB Budget Home Loan	Interest Rate 6.29%	Comparison Rate 6.32%	Fees Application: $449 Ongoing: $0 p.a.	Principal & Interest20% min. equityOwner-occupierLMI	Monthly Payment $929 per month	Cashback: Get up to $4,000 cashback when buying or refinancing. Loan size criteria applies. T&Cs apply.	Go to site View details Compare product selectionCompare	loading
Westpac Flexi First Option Investment Loan – Online Investor Variable Rate	Interest Rate 6.39%	Comparison Rate 6.40%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest30% min. equityInvestment	Monthly Payment $939 per month	Go to site View details Compare product selectionCompare	loading
NRMA Home Loans Variable Basic Home Loan	Interest Rate 6.19%	Comparison Rate 6.23%	Fees Application: $0 Ongoing: $0 p.a.	Principal & Interest40% min. equityOwner-occupier	Monthly Payment $919 per month	Bonus offer: Existing NRMA Insurance customers and NRMA members receive a $1,500 virtual gift card on settlement. T&Cs apply.	Go to site View details Compare product selectionCompare	loading

Showing 20 of 24 results

Frequently asked questions about mortgage brokers vs banks

Mortgage brokers often can't get you a better rate than if you were to go direct to a lender, but it depends.
Brokers generally have access to a panel of around 30 lenders. These panels won't have a lot of the smaller online lenders who offer the cheapest loans, but the panels will differ between brokers. You could compare home loans yourself across a larger number of lenders to find yourself a better deal.
However, not every borrower is eligible for a bank's lowest rate. It might be that your mortgage broker, who knows the banks' appetites, can find the lowest rate available for your situation or negotiate a bank's rate.
Mortgage brokers typically don't charge a fee to borrowers. They are instead paid by commission from the banks, with both an upfront commission and a smaller ongoing commission through the life of the loan.
However, there are some mortgage brokers who have chosen to charge a fee to borrowers instead of receiving a commission. Brokers may also charge fees if the borrower situation requires more work in certain complex situations.

Finder writers are subject matter experts and use primary sources, in-depth research and interviews with other experts to ensure you're getting accurate, up-to-date information. Articles are fact checked in line with our editorial guidelines.
1. Finder's mortgage broker database, accessed February 2025
2. MFAA statistics, accessed March 2025

Thank you for your feedback!

Written by

Richard Whitten

Senior Money Editor

Add to Preferred Sources

Richard Whitten is Finder’s Senior Money Editor, with over eight years of experience in home loans, property, credit cards and personal finance. His insights appear in top media outlets like Yahoo Finance, Money Magazine, and the Herald Sun, and he frequently offers expert commentary on television and radio, helping Australians navigate mortgages and property ownership. Richard started his career in education and textbook publishing in South Korea. He holds multiple industry certifications, including a Certificate IV in Mortgage Broking (RG 206) and Tier 1 and Tier 2 certifications (RG 146), as well as a Bachelor of Education from the University of Sydney and a Graduate Certificate in Communications from Deakin University. See full bio

Richard's expertise

Richard has written 764 Finder guides across topics including:

Home loans
Credit cards
Personal finance
Money-saving tips

More resources on Finder

Ask a question

Click here to cancel reply.

Display name

Your email (will not be published)

Your question

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms Of Service and Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

12 Responses

MarkusMay 9, 2016

Hi,

Do mortgage brokers use mainly the “big 4” or do they look at smaller type lenders too, like ubank, loans.com, mortgage house and so on?
If only some brokers use these how do I find out?

JodieMay 9, 2016

Hi Markus,

Thank you for contacting finder.com.au we are a financial comparison website and general information service.

Mortgage brokers work with a range of lenders you can check their panel of lenders by visiting the below provider pages on finder.com.au, also, you can check the mortgage brokers websites directly.

Regards
Jodie

markusMay 9, 2016

Hi Jodie,

Thanks for the reply.
Ok so if say a mortgage broker workes with NAB, woud that mean if ubank is affiliated with NAB that the broker will automatically work with that lender too?

JodieMay 9, 2016

Hi Markus,

Apologies I forgot to mention that the three lenders you pointed out, loans.com.au, UBank and Mortgage House, are not offered through any mortgage broker they only offer their home loans direct to the public.

Mortgage broker still work with a great range of lenders there are just some specific online lenders that choose to only offer their loans direct.

Regards
Jodie

DrewJanuary 25, 2016

If a customer was considered by a lender to be a “Good Borrower”; can the customer get as good of a deal going direct to a bank, as a broker could through their channels?

In other words, does a broker have more bargaining power than a customer, if they were to approach to same lender.

Finder

MarcJanuary 27, 2016Finder

Hi Drew,
thanks for the question.

It’s definitely possible for borrowers acting independently of a broker to get a great deal. Sometimes, some of the lowest rates are offered by lenders who do not work with brokers at all to keep their costs lower.

A broker has a distinct benefit when your situation isn’t clear cut e.g temporary visas, unusual income types, or you don’t have the time to properly evaluate your options. They’re also invaluable if you don’t really understand the home loan industry and products but want a good deal.

We’ve seen some great broker rates on offer too, so it’s helpful to compare home loans in the market regardless of which way you go to make sure you’re informed.

I hope this helps,
Marc.

BeatriceApril 8, 2015

A broker has given me 45, 000 I can borrow from a private investor however he wants the insurance up front is this normal

Finder

MarcApril 9, 2015Finder

Hi Beatrice,

Thanks for the question.

If you are referring to Lender’s Mortgage Insurance (LMI), this is normal to be required upfront. If you are ever in doubt about a particular deal, please seek the services of another mortgage broker or speak to a financial advisor.

Cheers,
Marc

HelenMarch 20, 2015

Hi Shirley,

Thanks for your reply.

I mean what sort of things are out of a mortgage broker’s authority? is there anything a mortgage broker not authorised to do in terms of advising or services?

Finder

ShirleyMarch 23, 2015Finder

Hi Helen,

Thanks for your question.

Mortgage brokers can not assist with investment and financial advice, this includes tax matters.

I recommend getting in touch with a licensed mortgage broker. A broker can help you understand your financial position and they can leverage their panel of networks to find a lender that’s more inclined to review your application.

Cheers,
Shirley

HelenMarch 17, 2015

what limits a mortgage broker’s authority?

Finder

ShirleyMarch 18, 2015Finder

Hi Helen,

Thanks for your question.

Could you please provide some further clarification to your question?

Cheers,
Shirley

More guides on Finder

LendUs
Use LendUs to find the right home loan and receive upfront and ongoing cashback for your loan. Simply fill out an online questionnaire to receive preliminary loan suggestions.
Rateseeker
Rateseeker is an online mortgage broker with access to more than 30 lenders and a wealth of knowledge amongst the team.
Loan Market
A Loan Market mortgage broker will do most of the hard work for you so that you can sit back and start planning life in your new home.
Finsure
Get professional help from the mortgage broker experts at Finsure. A mortgage broker can find a loan for you and help you apply.
Mortgage brokers in Melbourne
Compare brokers in Melbourne and get started on your home loan application.
Choice mortgage broker
Choice Aggregation Services and its ChoiceLend home loans are now part of Loan Market Group (LMG), which has retired the Choice brand.
Mortgage brokers in Perth
Find out how to compare different Perth mortgage brokers so you find a suitable loan with the right mix of features and rates.
Yellow Brick Road mortgage brokers
If you're interested in a particular loan, or want to learn more about your home loan options, just follow the Yellow Brick Road.
Mortgage Choice mortgage brokers
Choose the right home loan with free expert help from Mortgage Choice.
Aussie
Get home loan help with the mortgage experts at Aussie.

Mortgage broker or bank: What’s the better way to find a home loan?

Mortgage brokers guide you through the whole home loan process and can help you if you're in a rush. But comparing banks and lenders yourself is easier than you think.

Key takeaways