Get help with deciding which mortgage aggregator to go with as a new broker, or consider alternative aggregators for your established mortgage brokerage.
15 minute read
On your way to becoming a mortgage broker and wondering where to start? Or are you an industry veteran looking to make a switch for better business support? Whatever your situation, finding the best mortgage aggregator for your practice is the key to success. Learn how you can pick the right broker aggregator for your business by following these simple guidelines and consulting our mortgage aggregator list available below.
A mortgage broking aggregator or broker aggregator for short, is a company that has obtained accreditation with many lenders and thus can act as an intermediary between brokers and lenders. As compliance requirements are significant and vary from institution to institution, many mortgage brokers bypass the tedious work of getting accredited by each lender, and instead opt to join an aggregator to access their pre-existing panel.
Mortgage broking aggregators generate revenue through charging fees and/or taking a cut of the commission paid when brokers write a loan. In return, broker aggregators provide access to lenders and process commissions to ensure their brokers are paid on time and in full; but great aggregators do so much more.
By partnering with the right mortgage aggregator, your broker business may benefit in more ways than you can expect:
It’s important to understand, the total value that an aggregator can bring to your business may be dependant on your unique situation, or the kinds of support services you are looking for to compliment your mortgage broker business. Therefore, the best mortgage broker aggregator for another firm, may not be the best one for you.
Keep in mind, the main reason mortgage brokers opt to join aggregators is primarily to access their panel of members. Of course, this begs the question: why don’t mortgage brokers access lenders on their own?
Every lender has different accreditation requirements. That means that brokers must either approach banks and non-bank lenders one-by-one and submit similar (but not identical) stacks of paperwork for the privilege of offering the lender’s loans, or work with a reputable mortgage broking aggregator who already has the relationships and deals in place.
Furthermore, some lenders also have volume requirements and other prerequisites as well; CBA needs brokers to be members of the MFAA or FBAA; NAB requires brokers to be a part of an aggregator; and Bankwest wants to see a resume with 10 years of experience on it. These requirements are in addition to the standard demand for evidence of a Cert IV Finance & Mortgage Broking, visa/passport, photo ID, and police certificate. Even if a mortgage broker managed to get accredited by a few lenders, they will then have to hire teams to manage these relationship and compliance requirements with each of their lenders. Suffice to say it’s a big job, and that’s why many brokers see value in offloading this work to aggregators and getting back to the work that really matters: growing their book and serving their clients.
Brokers may also wish to become credit representatives of mortgage broker aggregators who hold a valid Australian Credit License (ACL), instead of getting an ACL themselves. This saves mortgage brokers from the ongoing administrative costs and compliance requirements of an ACL. Non-compliance carries hefty penalties and will impact a business’ reputation, so joining an established aggregator is a way to mitigate risk and gain a partner who has a vested interest in your business.
The best mortgage broker aggregators consider all these things and help you as both a mortgage broker and a business to get up and running as soon as possible. Picking the right one will save you both time and money so make sure you choose carefully and consider not only the fees an aggregator may charge, but also the services and support they are willing to provide.
If you’re on your way to becoming a mortgage broker some form of training is a requirement. ASIC requires mortgage brokers who are seeking an Australian Credit License to have “at least two years of relevant problem-free experience”. Similarly, the MFAA requires members to have two years of experience in mortgage or finance broking, or else prospective members must undertake training under a MFAA mentor. As a result, new mortgage brokers have to work as credit representatives of credit license holders in the first two years of their career before joining the MFAA or getting a credit license of their own.
This is where broker aggregators come in handy. Recognising that new mortgage brokers need mentorship when they join the industry, the best aggregators provide training and mentorship, along with business development must-haves including leads, lenders, industry software, marketing, and compliance support. Some aggregators go even further, investing heavily in the professional development of their brokers through platforms, seminars, webinars, and networking events across Australia. MBW for example, work with many of the leading aggregators and mortgage broker tools in Australia to compliment their systems by integrating them directly with our websites. For more information on the mortgage broker software we offer visit our services page or get in touch to speak to an expert.
Before you decide on your mortgage broking aggregator, consider these attributes to find the best mortgage aggregator for your business:
Differences between a mortgage aggregator, franchise group, and dealer group
You may come across other terms such as franchise group or dealer group when looking for a mortgage aggregator. Fundamentally, these broker groups do the same thing. They are collectively referred to as ‘aggregators’, because they aggregate loan volume through a network of brokers. Franchise groups are also aggregators, but their brokers operate under the franchise’s brand. Mortgage Choice, Aussie, Smartline, and Loan Market are some of Australia’s biggest franchise groups.
While there are a number of broker aggregators in the industry, you can check out our recommended mortgage aggregator list of MFAA recognised aggregators to help you get started on your journey.