Understanding the specific terminology of the mortgage and finance industry is essential for building a successful career. This glossary provides clear definitions for common terms you will encounter as a broker, helping you to communicate with confidence and precision.

The process through which mortgage brokers gain approval from individual lenders to offer their loan products. Accreditation typically requires brokers to complete specific training modules and demonstrate a comprehensive understanding of the lender’s policies and compliance standards.

An organisation that supports mortgage brokers by providing access to a panel of lenders, compliance resources, technology platforms, and professional development opportunities. Aggregators act as intermediaries, helping brokers manage workflow and fulfill industry requirements.

A fee paid by brokers to their aggregator in exchange for services such as access to lender panels, software platforms, compliance support, and business resources. The fee structure may be fixed or based on commissions.

An external dispute resolution scheme that handles complaints between consumers and financial service providers, including mortgage brokers. Membership in AFCA is required by regulation and ensures clients have access to fair and independent complaint resolution.

A regulatory obligation requiring mortgage brokers to act in the best interests of their clients when providing credit assistance. This duty ensures that client needs and objectives are prioritised above all else, and that any recommendations made are suitable and appropriate for the client’s circumstances. Adhering to this standard is essential for upholding industry professionalism and client trust.

The minimum educational qualification required to become a mortgage broker in Australia. This course provides the foundational knowledge and skills needed to operate in the industry.

A provision in a broker's agreement with a lender where the lender reclaims the upfront commission paid to the broker if the client's loan is paid off, refinanced, or discharged within a specified period (typically the first 1-2 years).

The remuneration paid by a lender to a mortgage broker for originating a loan. Commission is typically split into two main types: upfront commission and trail commission.

The percentage of commission shared between a broker and their aggregator or brokerage. This can vary depending on the agreement and the services provided by the aggregator or parent brokerage.

The ongoing training and education that brokers are required to undertake to maintain their industry memberships and accreditations. 

A detailed record of an individual's or entity's credit history, including previous credit applications, repayment conduct, defaults, and any bankruptcies. Credit files are maintained by credit reporting agencies and are used by lenders when assessing loan applications.

A mandatory document provided to clients that outlines the broker's services, how they are remunerated, their obligations (including the Best Interests Duty), and key information about dispute resolution options available to clients.

An advanced qualification that builds upon the Certificate IV. New members of the MFAA are required to complete the Diploma in their first 12 months.

The process of expanding a broker's service offerings beyond traditional home loans to include products such as personal loans, car loans, insurance, and financial planning. Diversification helps brokers meet a wider range of client needs and build a more resilient business.

The group of banks, credit unions, and other financial institutions that an aggregator has an agreement with. Brokers can offer loan products to their clients from the lenders on their aggregator's panel.

The total value of all loans a broker has arranged and continues to manage. It represents the broker’s portfolio of clients and is often used to measure the size and strength of their business.

TBC

TBC

An experienced and accredited broker who provides guidance, supervision, and support to a new broker during their initial years in the industry. Mentoring is a regulatory requirement for new entrants.

Assistance provided to brokers in promoting and developing their business. This may include access to branded materials, marketing templates, digital campaigns, and guidance on building a professional reputation through effective communication strategies.

Refers to the arrangement where an aggregator passes through the full commission received from a lender directly to the broker, without deducting a percentage. The broker then typically pays a fixed fee to the aggregator for their services.

A type of insurance that protects brokers against claims of negligence or breach of professional duty that may arise from the advice or services they provide. PI insurance is a mandatory requirement for all practising brokers.

An ongoing commission paid to the broker by the lender for the life of the loan. It is calculated as a percentage of the loan's outstanding balance and is paid periodically (e.g., monthly or quarterly) as long as the loan remains active. This rewards the broker for providing ongoing service to the client.

A one-time commission paid to the broker by the lender upon the successful settlement of a loan. It is calculated as a percentage of the total loan amount. This is the initial payment a broker receives for securing the client's business.

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