Will a mortgage broker get me the cheapest home loan?

Why "cheapest" is the wrong starting question

The lowest advertised rate on a comparison table is not always a loan you can get, keep, or use. Lenders price by loan size, loan-to-value ratio, purpose, repayment type, and your income documentation. Some sharp rates apply only to new borrowers at low LVR, or exclude investors, or require bundled products. A broker who recommends a loan you are likely to be approved for, with an offset you will use or a policy fit for casual income, is doing a different job from sorting a spreadsheet by rate alone.

That is what the best interests duty encodes. Since 1 January 2021, brokers must act in your best interests when providing credit assistance and give priority to your interests when a conflict arises. ASIC's Regulatory Guide 273 says cost is important, but so are your objectives, the effects of fees and features, and whether the credit product is likely to meet your needs. The broker versus bank comparison is partly about this duty: bank staff selling their own products do not owe you the same obligation to compare across the market.

When a dearer loan can still be in your best interests

None of this guarantees the broker picked the perfect loan. It explains why "cheapest" and "best interests" diverge in legitimate cases. The test is whether the broker can show you the options, explain the trade-off in plain language, and leave you with a written record.

What ASIC found in October 2026 (Report 840)

On 13 October 2026 ASIC published Report 840, a review of best interests duty and complaints handling at 13 credit licensees making up eight large mortgage broker aggregator groups. The review covered representative data from 1 April 2023 to 31 March 2025. ASIC said practices generally aligned with its guidance, but identified room to strengthen loan recommendation practices, supervision, and complaints handling.

• Cheapest option not always recommended: seven of eight aggregator groups reported that brokers did not recommend the cheapest loan option in more than 20 per cent of cases. ASIC acknowledged there can be valid reasons, such as features, but found instances where brokers lacked clear evidence for a higher-cost recommendation.
• Scale: ASIC noted that more than 80 per cent of home loans are now arranged through mortgage brokers, increasing the stakes for getting recommendations right.
• Complaints: complaints about the best interests duty took longer to resolve than other complaints; ASIC saw complaints missed, withdrawn without full investigation, or delayed.
• Expectations: ASIC expects licensees to monitor recommendations, especially where a lower-cost loan was available, and to require stronger evidence when the cost difference is large.

For borrowers, the practical read is not "avoid brokers". It is to treat the recommendation as something you can question and document. If a broker proposes a loan that costs more than another option on their panel, you should be able to understand why that delivers greater value for your circumstances, which is the standard ASIC's Commissioner Alan Kirkland stated in the media release.

Where a broker can still save you money

Brokers are not magicians on rates. They see the same rate cards as lender staff for many products. What they add is panel breadth, experience with which lender prices which profile on the day, and the ability to lodge pricing requests for discretionary discounts. The ACCC's 2020 Home Loan Price Inquiry was clear that only the lender can quote the final price once it has assessed your application, so any broker quote is indicative until the lender approves you.

Money saved often comes from fit and negotiation: choosing the lender whose policy accepts your file, avoiding a decline and a wasted credit enquiry, getting a retention discount from your current bank, or refinancing when the back-book rate is far above the front book. The commission model means most brokers charge you no fee on a standard home loan; the lender pays them on settlement. That payment structure is why Moneysmart tells you to ask whether pay differs between lenders, even though conflicted volume bonuses are banned.

Questions to ask before you accept a recommendation

Moneysmart's script is the baseline. Use it in the first meeting and ask for answers you can keep:

1. How do you get paid for this advice, and does it change between lenders?
2. Why did you recommend this loan, and why is it in my best interests?
3. What fees apply on the loan, and how do features change the true cost?
4. Which cheaper loans on your panel did you consider, and why were they not suitable?
5. Can I see this in writing with the credit guide and preliminary assessment?

Red flags match the broker versus bank guide: only one option shown, reluctance to discuss pay, a fee before a signed written quote, or no licence on ASIC's professional registers. If something goes wrong, complain to the broker in writing first, then the Australian Financial Complaints Authority if needed. The fees and duty guide walks through records and complaints in more detail.

DIY comparison still has a place

You can shortlist products on our compare hub or on public comparison sites, then sanity-check the broker's pick against your shortlist. If the broker's loan is dearer, you want a feature or policy reason you agree with, not a hand-wave about "service". If it is cheaper or matches your best find, ask the broker to confirm approval likelihood before you celebrate.

Your Finance Guide introduces you to one licensed broker who meets our criteria. We do not provide credit assistance; the broker does. Our credit guide explains how brokers are usually paid and the partnership fee brokers pay us to receive enquiries, which is paid by the broker, not by you.