Mortgage Brokers Darwin

Mortgage brokers in Darwin

A tropical climate, a cosmopolitan lifestyle and an abundance of natural attractions make Darwin a great place to live.

Adding to the city’s appeal, Darwin offers affordable housing and strong rental yields, which makes it an attractive market for home buyers and investors alike. A mortgage broker in Darwin can help you land the home loan you need to achieve your property goals.

The value of a Darwin mortgage broker isn’t limited to property buyers. A broker can also let you know how much you could save by refinancing an existing home loan. The catch is that Australia has an exceptional array of home loans. Canstar’s database of home loan providers extends to more than 90 different lenders.

This breadth of choice is a good thing, as competition helps to keep home loan interest rates competitive. But for consumers, the sheer volume of loans to choose from can be overwhelming. That’s where a mortgage broker in Darwin can help—sifting through a wide selection of loans to identify the home loan that best matches your needs and financial situation.

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How does a mortgage broker work?

A mortgage broker acts as a go-between for borrowers and lenders. Your broker will start by identifying your needs and financial goals, and advise if you’re in a position to take out a home loan. From there, the broker will recommend a suitable loan(s) from the range of lenders they work with.

The key point of appeal for many borrowers is that a mortgage broker will do all the hard work on your behalf—helping you complete a loan application, submitting it to the lender, and responding to any queries the lender may have about your application.

Your mortgage broker may even go the extra mile and help you apply for various schemes such as The HomeGrown Territory Grant.

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How many lenders can I access through a mortgage broker in Darwin?

Mortgage brokers in Darwin, as elsewhere, don’t work with every lender in the market. Rather, they help you find a home loan from the selection of lenders they partner with—known as their ‘panel’ of lenders.

The number of lenders on a broker’s panel varies widely. The big mortgage broking franchises can have more than 30 different lenders on their panel, with some also offering their own brand of home loans.

Smaller brokers may have as few as 10 lenders on their panel, which would significantly limit the range of lenders and loans a borrower in Darwin would have access to. However, a smaller broker may offer a more personalised service, niche advice for specific kinds of borrowers and strong knowledge of the local Darwin market.

Either way, a mortgage broker will likely give you more choice than a single lender alone. This is a key difference between mortgage brokers and mortgage lenders.

How much does a mortgage broker in Darwin cost?

The services of a mortgage broker shouldn’t cost you anything. Brokers don’t usually charge a direct fee to customers, instead they’re typically paid a commission by the lender you choose when you successfully apply for a home loan.

Mortgage brokers in Darwin, and elsewhere, can receive two types of commission from lenders:

Upfront commissions

A broker typically receives an upfront commission from the bank or lender providing the product when you, the borrower, first take out a home loan.

How much the broker receives depends on the lender involved. If a lender pays, say, 0.5% commission and your mortgage broker signs you up for a $500,000 home loan, your broker would earn an upfront commission of $2,500.

Remember that you, the borrower, don’t have to pay this. The commission is paid by the lender.

Trail commissions

Trail commissions are usually smaller than upfront commissions, but are paid out periodically. In some cases, a lender will pay a trail commission to a broker for each year that you stick with the same home loan product.

How do I find the best mortgage broker in Darwin?

It’s likely you’ll be working closely with your mortgage broker, so it’s important to find a person you feel comfortable with.

You can narrow down the search by asking friends, family or work colleagues if they have any recommendations of a mortgage broker in your part of Darwin, or the Northern Territory more broadly.

Referrals can be especially helpful if you are looking for a broker with particular experience—for example, working with borrowers who are self-employed or advising borrowers who hope to buy a home with a low deposit.

Online reviews can also be a useful tool to check if a Darwin mortgage broker has delivered on their promise of great service.

The Federal government’s Moneysmart website also suggests that those who are in the market for a mortgage broker can search for one through a professional association.

The Finance Brokers Association of Australia Limited (FBAA) and the Mortgage & Finance Association of Australia (MFAA) both have websites with searchable databases of licensed brokers, so you can find one in your local area.

Questions to ask a mortgage broker in Darwin

There are a number of key questions you might consider asking to find out if a broker is the right person for the job. You may ask a broker:

Do they hold a licence? Anyone doing business as a mortgage broker in Australia needs to be licensed to give credit advice. Licensed brokers are bound by statutory duties, and among these is the duty to act in the best interests of clients when recommending loan products. You can find out if a broker is licensed by enquiring through a professional body such as the FBAA or MFAA.

How do their fees and commissions work? Mortgage brokers in Australia typically do not receive upfront payment from clients. Instead, they’re paid via commissions and other perks from banks and lenders. You may wish to ask your broker how they’re paid, and if certain lenders offer more attractive remuneration than others.

How many lenders do they deal with? There’s no hard and fast rule as to how many lenders should be on a broker’s panel—indeed, a broker may have a small number of quality options for you or a large number of unsatisfactory ones. Even so, you may feel that the more lenders a broker deals with, the greater the chance they will find you a suitable home loan deal.

Do they favour a particular lender? If a mortgage broker sends a large proportion of their business to one particular lender, you may want to ask why and if they’re rewarded in some way for doing so. Even though brokers are required to act in your best interests, you may be concerned that you could miss out on a better deal elsewhere if your broker favours one lender over another.

What is their ownership structure? When assessing a mortgage broker, it may be worthwhile asking if a major bank or lender has an ownership stake in their business. You may be concerned that the broker will try and direct your business to this particular institution, causing you to miss out on a better home loan deal elsewhere. Likewise, it may be important for you to know that your broker is independent.

What post-settlement services do you provide? Mortgage brokers in Darwin will be keen to help you organise a home loan, but for many, their services don’t end there. Some brokers go a step further by conducting annual reviews of your loan to be sure it still meets your needs. The broker may even contact the lender each year on your behalf to negotiate a rate discount. It’s worth asking what sort of service your broker will provide after your home loan has settled, as it can help you remain confident that your home loan meets your needs going forward.

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About the author

Nick is a Content Producer at Canstar, providing assistance to Canstar’s Editorial Finance Team in its mission to empower consumers to take control of their finances. He has written hundreds of articles for Canstar across all key finance topics. Coming from a screenwriting background, Nick completed a Bachelor of Film, Television and New Media Production from Queensland University of Technology. Nick has also completed RG 146 (Tier 1), making him compliant to provide general advice for general insurance products like car, home, travel and health insurance, as well as giving him knowledge of investment options such as shares, derivatives, futures, managed investments, currencies and commodities. Nick’s role at Canstar allows him to combine his love of the written word with his interest in finance, having learned the art of share trading from his late grandfather. Nick strives to deliver clear and straightforward content that helps the everyday consumer navigating the world of finance. Nick is also working on a TV series in his spare time. You can connect with Nick on LinkedIn.