What is broker-led lending and why is it rising?

Broker-led lending is when borrowers source loans through intermediaries rather than going direct to a lender. It is rising because borrowers want choice, faster approvals, and clearer guidance on policy. Lenders also benefit from better matching and lower acquisition friction, which can improve conversion and credit outcomes across mortgages and SME finance.

How does a mortgage broker affect lender margins?

A mortgage broker can pressure headline rates but improve efficiency. If brokers lift conversion and reduce mismatched applications, lenders save on processing and credit losses. That can offset higher distribution fees. Net effect depends on payout structures, service speed, and arrears trends. Strong broker partnerships often support steadier margins over time.

What should investors track in the Australian mortgage market in 2025?

Track broker share of new originations, aggregator settlement volumes, commission and clawback settings, turnaround times, and arrears by channel. Watch product mix between fixed and variable, plus prepayment speeds after rate moves. Disclosures on broker tech, compliance, and white-label programs can also signal durability of margins and fee income.

Does SME finance through brokers raise credit risk?

Not by itself. Risk depends on underwriting quality, documentation, and product fit. A skilled broker can reduce risk by placing borrowers with the right lender and policy. Investors should review arrears by channel, exceptions, and any concentration in higher-risk segments, rather than assuming all broker-sourced SME loans are riskier.

Global Market Insights

Mortgage Broker, February 26: UK Broker-Led Lending Jumps to £33bn

ByDanny Kontos February 26, 2026

Mortgage broker trends are back in the spotlight after a new UK report showed broker-led lending to SMEs jumped 25% year on year to £33bn in 2025. For Australian investors, the takeaway is simple. Distribution shapes margins. When borrowers prefer advice, lenders and aggregators gain influence on origination volumes and pricing. We explain how this UK signal could flow through the Australian mortgage market, what it means for SME finance, and the key metrics to watch in 2025 and beyond.