How to become a mortgage broker in Australia

Nearly every page on this topic is written by a training college with a course to sell, or by an industry body that collects fees from working brokers. This site sells neither. The path below is the same one those pages describe. The economics are the part they tend to leave out.

The path in five steps

1. Complete the Cert IV

   The Certificate IV in Finance and Mortgage Broking, code FNS40821, is the entry qualification. It has 12 units, colleges sell it online and self paced, and it is measured in weeks or months rather than years. You do not need a degree.

2. Sign with an aggregator

   Aggregators sit between brokers and lenders. They give you the lender panel, the software, and commission processing, and most hold the credit licence you will operate under. Fees and support vary a lot between them, so meet several before you sign.

3. Become a credit representative

   There is no such thing as a mortgage broker licence. Under the National Consumer Credit Protection Act you either hold an Australian credit licence or you act as a credit representative of someone who does. Nearly every new broker starts as a credit representative under their aggregator's licence.

4. Find a mentor for two years

   If you are new to the industry, you work under a mentor for your first two years. The FBAA states this plainly and the MFAA publishes standards for how it should run. Mentors usually charge for their time, either a flat fee or a share of your commission.

5. Join the MFAA or FBAA

   Membership of one of the two industry associations is not a legal requirement, but many aggregators and lenders insist on it. Expect background checks: the MFAA wants a criminal history check and a credit report with your application. The MFAA also requires the Diploma, code FNS50322, within 12 months of joining, plus 30 CPD hours a year and professional indemnity insurance.

What the course is, and what it is not

The Cert IV is a ticket, not an education. It teaches the vocabulary of lending and the shape of the rules. It does not teach you to read a payslip quickly, structure a loan for a self employed couple, or keep a deal alive when a valuation comes in short. That skill comes from the mentorship years, which is why the industry requires them.

Course sellers present the certificate as the finish line. Treat it as the door. Budget for what sits behind the door too: aggregator fees, mentor fees, association membership, insurance, and software. None of these are large on their own. Together they are a standing cost you pay whether or not you settle a loan that month.

One decision at this stage does need paid professional help. How you set up the business, as a sole trader, company or trust, changes your tax and your risk, and that is a conversation for an accountant, not a forum thread.

How brokers are paid

Brokers earn commission from the lender when a loan settles. The client does not pay the broker on a standard home loan. The rates are industry convention rather than a published standard, and they move with lender and loan type. The convention runs close to 0.65 per cent of the loan upfront plus GST, plus about 0.15 per cent a year on the remaining balance, called trail.

An illustrative example, using those conventional rates. A $600,000 loan pays about $3,900 upfront. Trail adds about $900 in the first year, roughly $75 a month, and it shrinks as the balance falls. The aggregator takes its share before the rest reaches you. Now stack the timing problem on top: the upfront arrives after settlement, which can sit two or three months after you first met the client.

Illustrative only, computed at the conventional trail rate, before aggregator share, costs and tax.

The first two years, honestly

A new broker has no book, no referral network, and no repeat clients. Every deal must be found. Some buy enquiries from lead generation companies, some chase referral partners such as accountants and real estate agents, and most do both. We cover that machinery in our guide to where mortgage broker leads come from.

The published numbers say the middle of the industry is thinner than the marketing suggests. In the six months to September 2023, with inactive brokers excluded, 44.8 per cent of brokers settled $5 million or less, according to the MFAA Industry Intelligence Service. On conventional rates, $5 million of settlements is about $32,500 of upfront commission over six months, before GST, the aggregator's share, and every business cost. That is the realistic shape of year one and often year two, and it is why savings or another household income matter more than any course choice.

What established brokers actually earn

The last time the MFAA published pay data, in the report covering the six months to September 2023, average gross commission per broker was running at $192,354 a year. Read that number the way the report itself says to. It is revenue, not salary. Out of it come aggregator fees, rent, marketing, staff wages and every other cost of running the business. It is also an average, pulled up hard by large operators with staff, while the settlement figures above show close to half the industry writing a fraction of that volume. Later editions of the report dropped remuneration data entirely, so anyone quoting a precise current broker salary is guessing or selling.

Established brokers with a real book do earn well. The honest version is that the good money arrives in years three to five, funded by trail and referrals, and only for the brokers still standing by then.

Who should not do it

• You need a salary from month one. Commission lags work by months, and the first year often pays less than a junior office job.
• You dislike selling. Finding clients is the job, and the loan writing is what happens after you have done it.
• Compliance paperwork wears you down. The best interests duty and responsible lending rules generate plenty of it.
• The trail income pitch is the main draw. Trail only becomes meaningful once the book exists.

The people who do well tend to arrive with an unfair advantage: former bank lenders who kept their contacts, accountants with client bases, or a family broking business to join. Starting cold is possible. It just costs more months of thin income than the brochures admit.

Where to read next

Once brokers are established, many widen into business lending, and 7,023 mortgage brokers were also writing commercial loans by September 2024. If that path interests you, start with our guide to commercial property loans. And to see the client acquisition machinery from the inside, read where mortgage broker leads come from.

Common questions