Is mortgage broking a good career? If you have an eye for detail and a keen interest in real estate, a career in mortgage broking could be your ideal job. As a mortgage broker, you can help people purchasing property to find the right mortgage for their circumstances. You also work with mortgage lenders to negotiate the best deals for your clients.
Sound interesting? Let’s look more closely at what mortgage brokers do; then we’ll answer the burning question – How much does a mortgage broker earn per loan? And finally, we’ll discuss the finance and mortgage broker course you’ll need to complete to work in this rewarding profession.
What do mortgage brokers do?
Mortgage brokers are in the business of negotiating the best loan for the property buyers, who are their clients. Qualified brokers use their in-depth knowledge of the mortgage industry to pick and choose from among thousands of loans on offer by over 30 Australian lenders. The broker’s experience and expertise help them find the loan package that best suits the unique circumstances of each individual customer.
What are the main types of lenders, and who are they responsible for?
Choosing the right mortgage lender for a client can mean finding them better conditions for their loan agreement and/or a lower interest rate. So, when a mortgage broker is identifying the right loan for their client’s circumstances, they’re balancing things like financial responsibilities, current commitments and income with a loan agreement that won’t cause hardship or greatly reduce the quality of their client’s lifestyle.
Mortgage lenders are financial institutions and banks. Eighteen of Australia’s banks subscribe to the Banking Code of Practice, and this means they’ve committed to meeting the Code’s standards for good practice. For example, each of these 18 banks must have a responsible approach to lending and ensure they don’t lend clients the money they are unlikely to be able to repay.
Who pays the mortgage broker, and how much do mortgage brokers earn per loan?
The good news for home buyers is that they aren’t usually paying the mortgage broker’s fee themselves. Instead, the broker is paid a commission by the bank or financial institution that provides the home loan.
Here’s how it works:
Mortgage brokers routinely receive what is called an ‘upfront commission’, and this is paid by the lending bank or financial institution once the mortgage contract is signed. They usually range from around 0.65% to 0.7% of the loan value, plus GST.
Let’s break down this example: how much does a mortgage broker earn per loan of $1,000,000? If the commission on the home loan is set at 0.7%, the bank will pay the mortgage broker $7,000 plus GST once the contract is signed.
The next type of payment is known as a ‘trail commission.’ These are smaller payments that normally range between 0.165% to 0.275% of the loan value. They are paid annually to the mortgage broker for each year the borrower continues to pay down their loan.
So, looking back at that $1,000,000 mortgage we saw in the previous example, the mortgage broker would receive an annual trail commission payment of between $1,650 and $2,750. But don’t forget that trail commissions are calculated as a percentage of the mortgage principal, so they decline in value over time as the loan is repaid.
In 2017, the Royal Banking Commission recommended abolishing trail commissions for mortgage brokers. But the Morrison government declined to implement this recommendation, and the Albanese Government’s position is still unclear. At present, mortgage brokers continue to receive trail commissions on the home loans they negotiate.
The final way that mortgage brokers are remunerated is through non-monetary perks. These perks are provided by banks to mortgage brokers, and they typically include airline loyalty points, travel, and hospitality. An example of this would be an all-expenses paid trip to an overseas conference.
So, is mortgage broking a good, lucrative career? A major factor you may want to consider is: “how much does a mortgage broker earn per loan?”. As we can see, mortgage broking can be a lucrative profession. If you build a solid client base and a good reputation, you can create an exciting and rewarding career.
So how do I become a mortgage broker?
The minimum education requirement for a mortgage broker is a Certificate IV in Finance and Mortgage Broking.
Entry Education’s Certificate IV in Finance and Mortgage Broking course is the perfect place to start a stellar career in home loan finance. Entry is a Registered Training Organisation (RTO 41529), which means that our finance and mortgage broker course fully complies with ASQA standards, requirements, and industry best practice. This course will teach you everything you need to know about credit applications and loan processing procedures. You’ll also acquire knowledge of the relevant legislation to ensure that your work meets all legal requirements.
The Certificate IV in Finance and Mortgage Broking (FNS40821) course requires the completion of seven core units and five electives for a total of 12 study units.
The seven core units of the Certificate IV in Finance and Mortgage Broking (FNS40821) course are:
- FNSFMB412 – Identify client needs and present broking options
- FNSINC412 – Apply and maintain knowledge of financial products and services
- BSBPEF501 – Manage personal and professional development
- FNSCUS511 – Develop and maintain professional relationships in financial services industry
- FNSINC411 – Conduct work according to professional practices in the financial services industry
- FNSFMK515 – Comply with financial services regulation and industry codes of practice
- FNSFMB411 – Prepare loan applications on behalf of clients
In addition, Entry Education has selected the following electives that cover the topics you’ll find most useful in your mortgage broking career:
- BSBTEC301 – Design and produce business documents
- FNSASIC311 – Establish client relationship and analyse needs
- BSBOPS304 – Deliver and monitor a service to customers
- BSBPEF402 – Develop personal work priorities
- FNSSAM421 – Provide information on financial products and services to clients
Once you’ve earned your Certificate IV in Finance and Mortgage Broking, you can apply to be an authorised representative via an aggregator who will hold an Australian Credit Licence and commence your new career!
Find out more about how to become a mortgage broker here.
So, where do I start?
Entry Education’s Finance and Mortgage Broker course has no formal educational requirement for registration, although you’ll need to pass a basic English language, literacy, and numeracy quiz before starting your study program.
As this is primarily an online course, you’ll also need a computer and reliable internet. You will work through the course requirements in your own time and at your own pace. If you prefer personalised instruction, we hold face-to-face study sessions at our South Melbourne classroom or through Microsoft Teams video-conferencing workshops.
The fast track
If you want to get a head-start and turbocharge your way through our finance and mortgage broker course, you should attend Entry Education’s face-to-face workshops. In these workshops, you’ll learn from industry professionals who bring years of hands-on experience to the classroom.
In Entry Education’s workshop setting, you should be able complete the Certificate IV in Finance and Mortgage Broking course in around two to three days. Earning a Diploma in Finance and Mortgage Broking Management should take around four days.
You’ll come away from Entry Education’s workshops with just the right mix of theory, industry case studies and practical skills. These will give you a competitive advantage both in getting that first job and throughout your career.
The Entry difference
At Entry Education, we measure our success by your success. You’re more than a graduate; you’re a member of the Entry alumni. That means we’re behind you, applauding your career milestones and celebrating your successes.
When studying with Entry, you have after-hours access to our legendary support network throughout your course.
Have a question beyond how much mortgage brokers earn? The answer is just a click away with our interactive student portal.
If you’d like to listen to some of our past students talking about their experience at Entry Education, check out what these superstars have to say.
When you choose Entry Education’s finance and mortgage broker course, you’ll:
- have access to your personal online tutor throughout your course
- receive marked assessments within two weeks, or within a single business day if urgent (fee applies)
- pay a flat fee with no extra charges or hidden costs.
We’ll email a PDF copy of your certificate of attainment and transcripts. This will enable you to apply to be an authorised representative with an aggregator.
In review: Is mortgage broking a good career? The answer is yes! And, how much does a mortgage broker earn per loan? We worked that out for you too – read above. Now you have all the information you need to take the first step towards your brilliant career as a mortgage broker!
If we can help further, phone us on 1300 799 447, or fill out the contact form on our website. We look forward to speaking with you soon!
