Last Updated: 19th March, 2024

What Is A Mortgage Broker?

A mortgage broker negotiates and communicates with lenders on behalf of potential borrowers. If you’re planning to buy a property, like a house, a mortgage broker will help you find the ideal lenders for you and your situation. They advise lenders based on their objectives and capabilities and take the stress away by doing all the leg work. Furthermore, they are bound by the best-interests duty to always act in the best interest of their customers.

Mortgage Brokers Do The Following

  • Understand clients’ needs and goals
  • Assemble, check and send documents to lenders on behalf of clients
  • Assess clients’ financial situation, work out how much you can borrow and compare loans
  • Negotiate with lenders when possible
  • Keep clients informed regularly throughout the home loan journey and maintain a good relationship with them

Why Would You Need A Broker?

  • Brokers teach you how to buy. They will guide you through the home-buying process and are there to clarify any confusion.
  • They aren’t tied to particular lenders and products, so they can offer you a broader range of products to choose from without any partiality.
  • Their services are usually free, as lenders pay them.
  • TThey can speed up your application. Their good relationship with lenders means that their application turnaround times can be shorter by 2-3 days.
  • Brokers can make the home-buying process easier by liaising with your conveyancer and real-estate agent.
  • They specialise in specific types of loans that can be complex, such as investment loan, construction loans, bad credit loans, non-resident loans, loans for people with unusual employments situations and loans for non-traditional properties.
  • They can make your mortgage work for you through facilities like offset accounts and redraw facilities.

What Is A Financial Adviser?

A financial adviser is the person you reach out to if you need help managing aspects of your finances beyond purchasing property. Financial advisers can help if you are thinking about making investments that may affect your cashflow, you are thinking about increasing your retirement fund, or you want to let experts make the informed financial decisions in your life while you focus on other things.

Financial advisers work with you to understand your needs and help set your goals. They will help you create strategies to eliminate financial risk and work towards growing your money. They must hold an Australian Financial Services Licence (AFSL) to give financial advice.

Responsibilities Of A Financial Adviser

  • Explaining market conditions and investment options to clients
  • Identifying clients’ goals
  • Creating investment strategies to allow clients to accomplish their financial goals in the long run
  • Working on tax planning so that clients pay the lowest amount of taxes
  • Looking at all aspects of the client’s financial, life like healthcare, insurance, real-estate planning, retirement planning and inheritance planning
  • Exploring new investment options
  • Monitoring accounts and giving regular updates and summaries to clients


Robo-advisers are gaining popularity these days. These are applications that generate automated financial advice online. They generally can provide an automated portfolio based on your preferences. You have to answer a questionnaire for the algorithm to understand your risk tolerance, financial resources and goals. The algorithm will then build a diverse portfolio accordingly. Many robo-advice applications are available with low or no minimum investment and low annual fees. This has opened the door to millions who would have otherwise been excluded due to the high cost.

Difference Between A Mortgage Broker And Financial Adviser

Mortgage BrokerFinancial Adviser
Paid by lenderPaid by clients or product providers
Provides assistance with the completion of a mortgage applicationProvides assistance with financial planning and affordability
Assists clients with finding the best home loanAssists with a variety of financial matters, such as retirement planning, estate planning and budgeting
Needs to have a thorough understanding of the mortgage process and the different types of loans availableNeeds to have a deep understanding of financial concepts
Consults only about property loansDeals with any financial matter

A person buying a house may be confused about whether to approach a mortgage broker or a financial adviser. Let’s go through some differences between them in more detail:

1. Compensation methods: A mortgage broker is usually paid by the lender. This means that the bank or lender pays the broker’s commission, so clients usually don’t have to pay for brokers’ services. In contrast, a financial adviser is paid either through commissions from the products they sell, fees charged to clients, or a hybrid of both methods. This is more costly to clients, as it usually includes money from their pockets. A client may want to ask how they are compensated upfront so that they can ensure the adviser’s objectives are aligned with their own.

2. Areas of assistance: A mortgage broker provides assistance in the collection and completion of the home loan application, whereas a financial adviser can provide assistance in determining whether buying a house fits into your financial plans at the moment, and how much you can afford to spend.

3. Objectives:
A mortgage broker’s main goal is to find the best lender and home loan deal for the client’s unique circumstances. A financial adviser’s attention is inclined towards various financial matters, such as retirement planning, estate planning and budgeting, and ensuring that they align with the client’s overall financial goals.

4. Areas of knowledge:
A mortgage broker’s main task is to match the right clients with the right lender. Mistakes can lead to dire consequences, like lowering credit scores when a home loan has to be applied for again. This means that a mortgage broker needs to have a thorough understanding of the home buying process and be up to date on the different types of lenders and their products. Financial advisers have to assist in creating strategies to achieve financial goals. So, they must have a deep understanding of financial concepts and be up to date on factors such as the national and global economy so that they can give their clients accurate and helpful advice.

5. Areas of focus:
Mortgage broker is a more specialised role. They have in-depth knowledge of the home loan process and the market. While advisers look at the overall picture of a person’s financial standing. They have general knowledge of the areas they advise in and may not have in-depth expertise like mortgage brokers in any one area.

Financial Adviser Or Mortgage Broker?

Mortgage brokers and financial advisers serve very different purposes. There may be overlapping duties, like collecting the same information for assessments, but ultimately they are not the same.

If you are interested in finding the best home loan options and want someone to do all the legwork, a mortgage broker should be your choice. Based on their knowledge and expertise, they can narrow down the best products available for your situation. They may also be able to quicken your process with lenders with which they have a good rapport. However, mortgage brokers cannot make decisions or give you advice. They can only bring the best options to you.

If you are keen on keeping to your financial goals, a financial adviser can keep you on the right track. With their knowledge of finance, they can steer you away from risky investments and advise you on which moves to make. However, they may not be very helpful in finding the most competitive rates for you when getting a loan.

Mortgage brokers and financial advisers working together could lead to the optimal result for you. Financial advisers can devise a plan of action before you approach a broker so you can have clear objectives, or you can consult with a financial adviser for the final choice after getting the options from a broker.

Want the best home loan deal available to you? Call us on 1300 889 743 or complete our free online enquiry form and tell us a little about your circumstances. One of our experienced mortgage brokers can provide you with a free, no-obligation assessment.