Mortgage Brokers?



From: Shane .

If there is a previous post relating to this I apologize.... (please point me to it)

I've read a number of messages from people recommending the use of mortgage brokers.

Could someone provide some information about:
- what brokers offer
- why would one use a broker over directly dealing with the banks
- what costs are involved for employing their services
- any advantages or disadvantages
- things to look out for when dealing with a broker
- and lastly any recommendations for mortgage brokers in Brisbane.
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Reply: 1
From: Fiona W

Shane, my partner and I used a mortgage broker last year for our current home loan and intend to use her again!

What you do is give them the features you'd like in a loan and the purpose of the loan. ie. are interest rates the most important thing for you, or maybe you're not worried about interest rates but a redraw facility might be important. They gather all the information and find a loan which they consider would be suitable for you.

In our experience, we didn't have to pay a cent, as she was paid by commission by the lending body.

This leads me to the disadvantages and advantages. The more they get paid by the bank or whatever, the less of a deal you can negotiate. In other words, we weren't able to get the bank to drop the establishment fee which we have in the past! Another thing you have to watch for is that some brokers only 'work' for particular banks or lending bodies, which means that you are not necessarily getting the best loan you could get.

On the up side, we found any negotiations we lost out on, was far outweighed by the time and effort saved in finding the right loan. You don't have to go with who they suggest, we didn't at first. We asked her to look again, because we weren't convinced about the first one, and she came back with something better!

Brokers often have access to loans which you or I would not have even heard of which is excellent! The best brokers, as with anything, are those who have been recommended by word of mouth. Sorry about the long winded answer!...Good Luck!

-Fiona (Multimillionaire-2-B)
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Reply: 2
From: Rolf Latham

Hi Shane

Fiona has just about covered it.

Some good brokers also have access to recent sales and other stat data to ensure that the client is not paying too much for IP.

A good broker may also have some background in financial planning so they can give you an objective idea on your plans.

A good broker becomes your best buddy as long as he/she is more interested in your emotional well-being rather than his/her hip pocket. How do you know that ? Trust your gut feel !


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Reply: 3
From: Rolly Taddeo

Yes i used a broker in wollongong and he cost me extra $5000 because he couldn't settle on settlement date.
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Reply: 3.1
From: Rolf Latham

Hi Rolly

5000 in penalty interest to carry, Must have been a big loan, and/or a long delay.

When you say the broker could not settle on time what exactly do you mean, since you may have some claim on the brokers indemnity insurance.


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Reply: 4
From: Jan T

We used a broker who showed us a range of loans and recommended several loans which best suited us.
He was 'up front' about the couple of banks that don't use brokers but still showed us their products.
He was also able to demonstrate to us the best way the loans should be set up to enable further borrowings.
He did all the "leg work" and came to us with all the paper work and followed the process every step of the way.
We bought our first IP 2 weeks ago and the experience was so painless that we are already looking for our second. Thanks Rolf.

Jan T
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