The short version
Your bank has one product shelf. A commercial finance broker has access to 130 or more lenders — major banks, second-tier banks, non-bank lenders, and private credit. A broker wins most of the time, but not every time, and this guide covers both.
This is for business owners deciding whether to call their bank manager first or go via a broker.
What a commercial finance broker actually does
A broker is not a comparison website that fires your details to ten lenders at once — that's a lead-generation form. A commercial finance broker works the deal before any lender sees a credit submission.
1. Understand the deal
The broker maps the purpose (equipment purchase, property acquisition, working capital, trade cycle), the size, the timing, and the exit strategy. Purpose determines the right product. Timing determines which lenders are currently open. Exit determines the appropriate term.
2. Structure the facility
Before submission, the broker designs the deal: facility type (chattel mortgage, secured term loan, revolving line, debtor finance), security (asset security, real property, personal guarantee, or unsecured), LVR, term, and repayment shape — P&I, interest-only, or a seasonal structure if the business has lumpy cash flow. Banks default to their standard product box. A broker structures around the business.
3. Select the right lender
One lender gets the credit submission — chosen because that lender has demonstrated appetite for this deal type, this industry, this structure, and this borrower profile right now. Not five lenders at once. One, selected for fit.
4. Manage the process to settlement
The broker handles lender queries, valuation instructions, legal requirements, and document execution through to settlement. The brokerage commission, paid by the lender on settlement, covers all four steps.
130+ lenders vs one product shelf
A bank can offer you its own products. If those products don't suit, the answer is no — or a structure that fits the lender's box rather than your business's needs.
Aurelius Capital writes across the major Australian banks and their commercial arms, second-tier banks (Macquarie, BOQ, Judo, Heartland, and others), specialist non-bank lenders, and private credit. That breadth matters in three concrete ways.
Pricing. When multiple lenders are credibly competing for the same deal, pricing is competitive. Your own bank has no incentive to sharpen its pencil if it believes you're coming to them regardless.
Product fit. Not every lender suits every deal. Some second-tier banks are built for SME relationship lending with flexible policy. Non-bank lenders frequently move faster and price more aggressively on asset finance and equipment finance. Private credit fills the gap when a deal needs speed, complexity tolerance, or a lender open to construction risk. Knowing which lender suits which deal — covered in our guide to the six categories of business lender in Australia — is a core broker skill.
Access. Some lenders don't accept direct applications. Certain non-bank and private credit lenders are broker-only. Go direct, and those lenders simply aren't available to you.
In the six months to September 2024, brokers settled $22.68 billion in commercial loans across Australia — up 31.2% year-on-year — which reflects how consistently business owners use the broker channel to reach lenders and products unreachable through a branch.
Lender appetite and your credit file
This is the most underappreciated reason to use a broker. Every formal credit application creates an enquiry on your credit file. One or two enquiries in twelve months: no issue. Six enquiries in three months: lenders notice, and some will decline on that basis alone, before they've even read your financials.
The business owner who shops a deal by calling three banks, submitting to two, and collecting one decline has done real credit-file damage before the right lender ever saw the deal.
A broker submits to one lender at a time, chosen because that lender is likely to approve — based on live knowledge of lender appetite: which banks are currently open for construction risk, which non-banks are pricing aggressively on transport assets this quarter, which private lenders are actively deploying at a specific LVR. That intelligence accumulates through active deal flow and direct access to credit teams, and it lets a broker tell you, before submitting, whether the deal has legs — and with whom.
Why the shape of the facility matters
Banks don't always tell you when a structure is suboptimal. Their job is to approve the product they offer, not to design the right product from first principles.
A worked example: a transport business buying a $600K prime mover might approach its bank and receive a standard chattel mortgage over 60 months. A broker might instead structure 84 months with a balloon aligned to the truck's residual value, through a specialist asset lender with appetite for heavy transport — at a sharper rate than the bank's standard offering. Both are valid. One is better for this business at this point in its cash cycle.
Structure is equally material in commercial property. The choice between a commercial mortgage with a major bank at 70% LVR P&I versus a non-bank interest-only at 75% LVR affects cash flow, tax position, and the capacity to service the debt during a growth phase. For asset acquisitions, whether a chattel mortgage vs operating lease suits the specific asset and purpose affects ownership, tax treatment, and balance sheet — not just monthly repayments.
How commercial finance brokers are paid
Brokers operating in commercial-purpose lending are paid by the lender, not the borrower:
- Upfront commission: typically 0.5%–1.5% of the loan amount, paid by the lender on settlement.
- Trail commission: an ongoing payment, often 0.1%–0.3% p.a. on the outstanding balance, paid by the lender over the life of the facility — common in some product categories, not all.
Both must be disclosed to you in writing before you commit. On complex transactions — structured finance, private credit, development funding — some brokers also charge a structured finance fee to the borrower, disclosed upfront. The broker's cost is absorbed in the lender's pricing, which is why broker-channel pricing stays competitive. The full picture is in our guide to how commercial finance brokers get paid.
When going direct to a bank still makes sense
Going direct is the right call in three situations:
- You are extending an existing facility with the same lender and the pricing is already competitive.
- The deal is genuinely straightforward — a sub-$200K equipment loan on a standard asset, clean borrower profile, lender relationship already in place.
- You already have a credit-approved term sheet you're comfortable with.
The threshold: go direct when you know the lender, know the pricing, and the structure is standard. Use a broker when any of those three is uncertain, or when the deal has complexity, size, or lender-appetite risk.
What to look for in a commercial finance broker
- Commercial specialisation, not residential crossover. Ask what proportion of settled volume is commercial — commercial credit assessment and lender-appetite knowledge are a separate discipline.
- Panel breadth. A 15-lender panel and a 130+ lender panel are not the same product. Ask how many lenders the broker is accredited with, and whether they reach non-bank and private credit, not just the majors. The Aurelius Capital lender panel spans commercial property, business lending, asset finance, and private credit.
- Industry accreditation. CAFBA is the peak body for commercial finance brokers in Australia; FBAA membership with a Certified Finance Broker designation is a second relevant marker.
- ASIC registration. Ask whether the broker holds their own Australian Credit Licence or operates as a credit representative of an aggregator. Ask for the number and verify it on ASIC Connect before you hand over financials.
- Commission disclosure upfront. A reputable broker discloses how they are remunerated in writing, before you proceed.
Where broker involvement adds the most value
- Commercial property finance — multiple lender categories, varied LVR policies, significant structuring choices. The bank vs non-bank commercial finance guide covers the landscape.
- Asset and equipment finance — pricing varies considerably across lenders for the same asset; the structure choice has tax and accounting implications.
- Working capital and cashflow finance — overdraft, revolving line, debtor finance, trade finance, invoice discounting; lender appetite is highly variable.
- Development and construction — specialist lenders only, structure is critical, and pre-sales requirements, cost-to-complete ratios and LVR policy vary enormously.
Sources
- MFAA Industry Intelligence Service 19 — April to September 2024
- CAFBA — Who We Are
- FBAA — Certified Finance Broker (CFB) Program
If you have a deal in mind and want a broker's read on structure, lender appetite, and likely pricing before you approach anyone, the application form is the starting point.