Buying guide

Do I need a mortgage broker to refinance my home loan?

To help you sort your mortgage out we’ve answered common questions around mortgage brokers.

Last updated: 12 October 2023

Refinancing your mortgage can be a tricky business and you may have a number of questions.

One way to get answers is to work with a mortgage broker - an intermediary who arranges loans for consumers (like you) on behalf of banks and other lenders.

But do you actually need a mortgage broker to refinance your loan? And what can a mortgage broker do for you?

No you don’t need a mortgage broker to refinance your home loan

It’s not necessary to use a mortgage broker to refinance your home loan - you can go straight to your bank or other lender. But if you want impartial expert advice on home loan options from multiple lenders, it could be worth speaking to a broker.

If you’d rather go directly to your current bank or lender to refinance you may be able to simply select a new rate in their online banking app or web portal to have your loan roll over automatically. That’ll work, provided you’re eligible and you don’t want to change lenders or choose a new type of home loan. Otherwise you’ll need to contact your chosen lender directly or make an online application (if available).

Refinancing could save you money to spend on the things that really matter.

How can a mortgage broker help you?

While you don’t need to use a mortgage broker to refinance your home loan there are several benefits to doing so.

When you go directly to a lender to refinance your mortgage, they can only provide advice on the products and services that they offer. That means if you want to shop around to find the best deal you’ll have to do it yourself. Mortgage brokers, on the other hand, work with a number of lenders and are therefore able to provide advice on a range of different home loan options.

  • They can also help you put your home loan application together, making the application easier and less stressful.
  • Brokers have close working relationships with lenders. They may be able to find you lower interest rates than those that lenders advertise, and act on your behalf in negotiations.

  • If you have unusual circumstances (such as if you’re self-employed or have a bad credit score) a mortgage broker may be able to help you find a lender who’s right for you.

  • Most mortgage brokers do not charge for their services - they receive commission from lenders for brokering loans.

Mortgage brokers are required to be registered and qualified financial advisors by law. That means your broker should be able to provide impartial expert advice on a range of financial matters.

The drawbacks of using a mortgage broker

While there are many benefits to going with a mortgage broker, there may be a few drawbacks too.

  • Most brokers don’t work with all lenders (and some banks won’t deal with brokers at all) so you may have a limited selection to choose from than if you went to all the lenders.
  • They may also receive larger commissions from certain lenders which incentivise them to offer you certain products instead of others, regardless of whether they’re the best option for you. Don’t be shy about asking your broker about this.

  • Last of all, if you engage a mortgage broker and receive advice then choose not to arrange a home loan through them, your broker may charge you a fee. Make sure you understand the conditions of your agreement with your broker before you start working with them.

When should you see a mortgage broker?

You can see a mortgage broker at any time as you prepare to buy a home, refinance your mortgage or just receive advice on home loans.

For example, if you’ve just decided you want to buy you could see a broker for advice around how much deposit you need to save, how much you can afford at your level of income and how the loan application process may work. If you’re ready to buy or refinance you could also see a broker to arrange a home loan and provide advice on what’s best for your circumstances.

Could refinancing with a mortgage broker save you money?

Do mortgage brokers do credit checks?

Your mortgage broker may perform a credit check when you apply for a mortgage on behalf of your chosen lender, but usually this is your lender’s responsibility. You can also check this yourself online using a website like Credit Simple.

If you’ve got a low credit score it’s worth mentioning it to your mortgage broker - they’ll be able to select lenders who are more likely to accept applications from borrowers who’ve had financial issues in the past (such as defaults or bankruptcies).

So is a mortgage broker right for you?

It’s possible to refinance your mortgage or apply for a new home loan without a mortgage broker, and thousands of Kiwis do this every year. If you’ve done your own shopping around and you know what lender you want to go with, this may even be your best option.

But if you want impartial expert advice, help choosing from a selection of lenders and help preparing your application - working with a mortgage broker could be a great idea.

*We hope this article has provided some helpful information. It's based on our experience and is not intended as a complete guide. Of course, it doesn’t consider your individual needs or situation. If you're thinking about buying or selling a property, you should always get specific advice.


Ben Tutty
Ben Tutty

Ben Tutty is a regular contributor for Trade Me and he's also contributed to Stuff and the Informed Investor. He's got 10+ years experience as both a journalist and website copywriter, specialising in real estate, finance and tourism. Ben lives in Wānaka with his partner and his best mate (Finnegan the whippet).