http://www.oasia.com.au Property Sales    Property Management    Mortgage Brokering



Do Mortgage Brokers charge any fees?

I have constantly been asked this question.   Do we charge a fee for service and if we do not, then how or where do we make our money from?

This is a very valid question.   I can safely say that most mortgage brokers do not charge a fee for service.   If they do, it would normally be for commercial transactions, which is typically much more complicated.   However, if they are going to charge a fee, this has to be disclosed up front.   When you sign the credit guide, it would be stated as to whether there will be a fee charged for service rendered.

At Oasia, we do not charge any fees.   We are paid by the lenders for any successful loan lodged.   The amount of fees we get are always reflected in the loan documents that you will have to sign when securing the loan.

However, in the market place, I have come to be aware that there are brokers who include a claw back clause in their credit guide or credit quotation.  This can be rather unreasonable as many people sign the quotation not realising that there is such a clause.   Basically, the lenders do claw back any fees paid to the brokers should the loan be refinanced or paid up within the first 12 to 18 months. The claw back can be as much as 100% or 50% depending on the lenders.  So, there are brokers who will pass on this claw back to their clients and is stated in the credit guide or quotation.   Be very careful to read all these fine prints as it will become rather untidy when you get a letter from the broker asking for a claw back of their commission.   Some even put the claw back as a standard 1% plus other admin fees.

The above appears very unreasonable and hence all customers should be very careful when accepting a credit quotation.   They have to make sure that they know what they are signing.   Be aware that most brokers in the market do not charge a fee and do not impose such a claw back, so feel free to question the rationale and move on should this not be removed.