When fees do not apply: Usually, there are no fees for most loans.

• Illawarra Mortgage Brokers typically provides a free service to our clients for most home and residential investment loans, as we are paid commission by the lender.

• If you are refinancing a home loan, buying a home to live in or a home to rent out as an investment property, as long as the loan amount required is more than $300,000, there are no fees payable.

Illawarra Mortgage Brokers Fee Disclosure Policy:

If a fee applies relating to the facilities noted below, you will be provided with a Credit Quote from us, outlining such fees and the reasons for them - before we begin a formal application for finance with a lender. 

Please Note: There are no fees payable at all for discussing your loan options or scenarios, as they only apply when we are processing an application with a lender on your behalf, and if the loan falls into the categories listed below.

Any fees listed below are applicable due to the extra time we would need to allocate for complex lending. To be 100% transparent, it’s important for our clients to understand the instances where fees would apply.

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A brief overview of when fees apply: (Detailed explanations below)

• Complex Lending (company, trust, and Self-Managed Super Fund home loans, non-conforming & complex self-employed loans)
• Loans under $300,000
• Business & Commercial Loans

• Pre-Approved home loans are charged a 100% refundable fee * (Refunded on settlement - see conditions below)
  
  *A $400 fee applies for pre-approved home loans where a property has not yet been located. Once a suitable property has been located and the loan we initiated is then settled, this fee is fully refunded to you.
  
  We charge this fee to cover the time needed to process a full pre-approval application. It also confirms your commitment to working with us. If your pre-approval expires (as most lenders require re-assessment after 90 days), it will be re-applied for you with no further fees.
  
  A pre-approved facility means that your loan application has been fully submitted and reviewed by a lender. The lender has then issued a conditional approval, indicating their willingness to support your loan. Usually, a suitable property to purchase is your only outstanding requirement.
  
  The $400 fee will be refunded as mentioned once the transaction is complete. In essence, you are not paying any fees when it all balances out, as long as your loan proceeds to settlement.

Detailed Explanations regarding fees:

• Complex lending structures – For those clients who have complex structures set up for tax reasons, Super Fund lending or even for asset protection reasons. The work is much more labour intensive and usually it takes three or four times longer than a standard home loan application. 
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• There are many types of entities that can be used to purchase property.
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  ‍The types of structures used for complex home loan lending are:‍
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  • Self-Managed Super Fund Lending  - Property Investment Trusts
  • Unit Trusts - Discretionary Trusts - Family Trusts - Hybrid Trusts
  • Company lending

Using the Self-Managed Super Fund (SMSF) home loan as one example. A SMSF can purchase either residential property or commercial property as an investment. 

There are multiple entities associated with SMSF lending, resulting in a substantial amount of time for us to structure these loans properly. In addition to this, most lenders do not offer these types of loans at all - and the lenders who do provide these loans, will need to be compared at the time of application regarding the products available. Lender policy also needs to be looked at for recent changes that can negatively affect an approval.

Loans under $300,000

For loan applications under $300,000, we charge a fee. This is due to the administrative costs involved in processing a loan application, which the commission alone does not cover. We will advise you of this fee in writing when we assess your loan inquiry and only if we can assist you. 

Be assured that your initial consultations with us remains free of charge. This allows you to discuss your needs and objectives with us, without incurring any costs, and ensures that you are not paying for a service that does not result in a loan application being processed. 

Any fees applicable are advised to you in writing, prior to beginning an application for you.

Existing clients are exempt from this fee for loans under $300,000, as we have an existing relationship with them.

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Commercial or Business Loans: 

Commercial and business loans require significant time and effort to structure properly. This involves close collaboration with the lender's credit department, as well as your accountant and solicitor, to determine the most suitable lending structure and loan types for your needs.

Due to the complex nature of these loans, we need to dedicate ample time to ensure that we are requesting the most effective loan for your needs. Therefore, these loans incur additional fees that reflect the extra time and expertise allocated, ensuring the best outcome for you.

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How Mortgage Brokers Are Paid

Mortgage brokers receive an upfront commission from lenders only upon a successful loan settlement and we receive an ongoing trail commission for ongoing client support. 

To be able to receive a commission, we train with the lender to receive lender accreditation, allowing us to deal with clients on the lender’s behalf. We complete the work that the lender would have normally done at a branch for example, however we are responsible for sourcing our own clients and introducing them to the lender who best suits their needs.

We work with an aggregation group (Aggregator) a company that partners with numerous lenders and banks for brokers access a wider choice of lenders and provides the use of advanced software, which we use to serve our clients effectively.

The aggregator receives a monthly payment that comes directly from our commission income from each loan. Using an aggregator is a standard practice for mortgage brokers and a requirement for operating in this industry.

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Key Points About Commissions

• Clients do not pay our commission at all; It is a direct cost to the lender.
• Commission does not result in higher interest rates or fees for clients.
• Brokers work for you, our customer. We are not employed by the lenders at all. We are paid by commission only, and therefore we are self-employed.

If you have any questions about fees, please feel free to contact us for clarification.

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