What actually changes when you go direct to a bank
Walk into a bank, and you'll be shown that bank's products. One lender, staff who are naturally incentivised to sell what their employer offers, no real market comparison, no specialist expertise beyond that one institution's policies, and every bank you approach directly generates its own separate credit enquiry on your file. You also manage all the paperwork yourself.
Go through a broker instead, and you get access to more than 50 lenders rather than one, independent advice, a genuine comparative analysis across the panel, specialist knowledge for situations that don't fit a standard mould, a credit file that's protected because the broker manages the enquiry process, someone else handling the administration, and ongoing support after settlement.
What a broker actually does
A broker is a licensed credit professional who assesses your financial position, identifies suitable lenders for your situation, compares products across their panel, prepares your application, liaises with lenders on your behalf, coordinates settlement, and stays in touch afterwards, including annual rate reviews to make sure you're not left on an uncompetitive rate.
Why access to more than one lender actually matters
A rate difference of just 0.5% on a $600,000 loan adds up to roughly $160,000 in extra interest over the life of the loan. That's the scale of what's at stake when you only see one lender's products instead of comparing across the market. To put it in perspective across different loan sizes: that same 0.5% gap costs approximately $47,000 in extra interest on a $500,000 loan, $66,000 on a $700,000 loan, and $85,000 on a $900,000 loan, all over a 30-year term.
Best interests duty: why brokers are legally required to act in your favour
Since 1 January 2021, brokers have been legally required to act in the best interests of the consumer under the National Consumer Credit Protection Act. That duty requires recommending products that suit your interests, even where that conflicts with the broker's own interests, and prohibits recommending something unsuitable regardless of what it would mean for their commission. Bank employees don't operate under an equivalent legal obligation.
How brokers are actually paid
Brokers are paid by the lender, not by you. Typically that's an upfront commission of around 0.65% of the loan amount at settlement (on a $700,000 loan, roughly $4,550), plus an ongoing trail commission of around 0.15% a year while the loan remains active. You pay nothing directly for the service.
The administrative load a broker takes off your hands
Instead of submitting documents separately to five different banks, you submit them once, to your broker. That avoids multiple credit enquiries landing on your file at once, applications get prepared to each specific lender's requirements, you get proactive updates while your application is being assessed, and settlement is coordinated across everyone involved rather than left for you to chase.
Where specialist knowledge earns its keep
Some situations genuinely benefit from a broker's market-wide view. Self-employed borrowers get assessed differently by different lenders, some are far more workable than others for the same income profile. Borrowers with bad credit or past defaults face lenders that reject any default outright and others with much more nuanced policies. Low deposit borrowers see meaningfully different LMI premiums and waivers depending on the lender. Investment lending carries different serviceability assessments and LVR restrictions across the panel. And construction loans vary in their progress payment structures and builder requirements from one lender to the next.
The value of an ongoing relationship
Because brokers earn trail commission on your loan while it's active, there's a genuine incentive to keep it competitive over time. That typically shows up as annual rate reviews, proactive contact before a fixed rate expires, help with refinancing when it makes sense, and support for whatever comes next, whether that's an investment purchase or a next home. It's also worth something that a broker retains continuity of knowledge about your situation, rather than you starting from scratch with whichever bank staff member happens to be on shift when you call.
Stanford Financial's approach
We're based in Springfield Central with access to more than 50 lenders, and have settled over $500 million in loans, recognised nationally with MFAA awards for diversified brokerage and newcomer of the year. Director Steven Beach personally reviews every application that goes through us. We work with first home buyers, investors, refinancers, self-employed borrowers and defence personnel across Queensland and Australia-wide.
Frequently asked questions
Does using a mortgage broker affect my credit score? A single broker submission generates one credit enquiry, versus multiple enquiries if you approach five banks directly yourself. Multiple enquiries in a short period can reduce your score, so going through one broker is generally the more protective path for your credit file.
Is a mortgage broker the same as a lender? No. A broker is an intermediary who doesn't lend directly, while lenders, banks, credit unions and specialist lenders, provide the actual funds.
Can a broker get me a better rate than going direct to a bank? Often, yes, through volume relationships with lenders, access to rates that aren't publicly advertised, and the ability to negotiate using competing offers as leverage.
What happens if I'm not happy with my broker's recommendation? You can ask for a full explanation, including why other options were ruled out. If you remain unhappy, you can lodge a free complaint with the Australian Financial Complaints Authority (AFCA).
How do I know if my broker is comparing all the available options? Ask about the size of their panel, and request a written comparison of three to five options with reasoning behind each. A good broker welcomes these questions. You can also verify a broker's Credit Licence on ASIC's Connect register.
What the process actually looks like
The typical journey runs from an initial consultation through to settlement in around three to six weeks, and generally takes about two to four hours of your own time across the whole process. It doesn't end at settlement either: ongoing annual rate reviews and refinance monitoring continue afterwards, so your loan doesn't quietly drift out of date.
Free, no-obligation consultations are available in person at our Springfield Central office, by phone, or by video call, and we typically respond within one business day.
Call us on 0483 980 002 to get started.
