Step by step to becoming a mortgage broker

  • Staff Reporter | May 29, 2018
Mortgage Broking - Skills

In Australia, over 55 percent of residential property buyers turn to mortgage brokers when the time comes to finance their loan.

Mortgage brokers assess the financial situation of their clients and use their specialist knowledge of the home loan product market to find a loan that will fit the client’s needs. Commissions are paid to mortgage brokers by the lender as a percentage of the total loan amount.

Everybody wins! Your clients get the best deal on a home loan that suits them (without having to pay any fees to the broker); the lending institution gains a new customer, and the mortgage broker gets paid a commission.  

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Mortgage broking is a highly regulated industry, and not just anybody can go out and start recommending products. There are a few steps you’ll need to complete before you can start brokering your first mortgage.

So where do I start?

Step 1: Get qualified

The minimum training requirement for mortgage brokers is to complete a Certificate IV in Finance and Mortgage Broking. In this course, you’ll learn about the mortgage broking industry and regulation, how to research and monitor industry trends, nurture relationships with clients, documenting client needs and presenting options available to them, and how to assess the suitability of financial products.

If you want to give yourself a head start in mortgage broking, you could upgrade your qualification to the Diploma of Finance and Mortgage Broking, which will give you access to more opportunities in the industry through memberships and lenders who require brokers to have this higher qualification.

Just how much of the mortgage industry is written by a broker?

Value of new loans placed by brokers is on the up

 

Step 2: Join a professional association

There’s no regulatory requirement for mortgage brokers to join an industry association, but many employers, loan aggregators and lenders require the brokers they deal with to be a member of either the Mortgage and Finance Association of Australia (MFAA) or the Finance Brokers Association of Australia (FBAA).

Step 3: Get your first job

Mortgage brokers have many options for employment – you could join an existing firm, purchase a franchise, or go out on your own.

When you’re starting out, joining an established brokerage might be the right choice for you as you’ll be supported by an existing brand and network of mortgage brokers.

Some brokerages will provide you with a base salary as a safety net, but this may be something you need to negotiate with your employer before signing. Generally, the higher the base pay the less commission you’ll receive and the higher the sales targets. Often, employees on higher base salaries won’t receive a trailing commission.

As an employee of a brokerage, you may not have to apply for an Australian Credit Licence at this stage because your employer will have one and will be able to authorise you as their representative.

Get started today

There are lots of reputable Registered Training Organisations to choose from when it comes to completing your Certificate IV of Finance and Mortgage Broking – find one that suits you!

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