Mortgage Brokers and Caveat Loans: Can Your Broker Arrange One?
Can your mortgage broker arrange a caveat loan? Why most panels leave them out, how a broker is paid on one, and where the best interests duty stops.
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Mortgage Brokers · Caveat Loans · Private Lending
The broker who did your home loan may not be able to place a caveat loan. Here is why most panels leave them out, how a broker is paid on one, and which protections reach a business-purpose loan.
Quick Answer
A mortgage broker can arrange a caveat loan only when they have access to private funders, and most home loan panels leave those funders out, so many brokers refer the deal to a private lending specialist. Ask early whether your broker places caveat loans, how they are paid on one, and which protections apply, because a business-purpose loan sits outside the home loan rules. If your real question is what a caveat on title does to your mortgage, that is covered separately below. Switchboard places caveat loans for self-employed business owners.
Also called: caveat loan broker, private lending broker. A caveat loan broker places private and caveat loans specifically; a mortgage broker mainly places home loans.
Can a mortgage broker arrange a caveat loan?
A mortgage broker can arrange a caveat loan if they are set up to place private lending, but the broker who did your home loan often is not. Home loan broking runs on a panel of banks and non-bank lenders with standard products and standard paperwork. A caveat loan comes from a private funder, is priced deal by deal, and is secured by a caveat on your title rather than a registered mortgage. Those funders sit outside most mortgage broker panels, so the first answer you get may be a polite referral rather than a quote.
That is not a sign your deal is bad. It is a sign the product is different. A caveat loan is short term, it is for a business purpose, and the lender reads your property equity and your exit before anything else. If your broker has never placed one, the honest move is to say so and pass you to someone who has. The business purpose point matters from day one, because it decides which rules apply to the whole deal, and we cover it in what a business purpose declaration means on a caveat loan.
If you searched this because you want to know what a caveat does to your existing mortgage, that is a question about the instrument on your title rather than the broker. It is covered in refinancing with a caveat on title.
| What changes | Home loan through a mortgage broker | Caveat loan through a broker |
|---|---|---|
| Lender panel | Banks and non-bank lenders on the broker's accredited panel | Private funders, often off panel, that the broker deals with directly |
| How the broker is paid | Typically lender commission, often with no fee charged to you | Lender commission, a broker fee or both, disclosed in writing |
| Best interests duty | Applies, because the loan is consumer credit | Generally outside it, because the loan is for a business purpose |
| Complaints body | The broker and lender are generally members of the external dispute scheme | The broker may be a member; a commercial-only lender may not need to be |
| What the lender reads first | Income, expenses and capacity to repay over a long term | Equity in the property, the title and the exit |
| Documents | Payslips or financials, bank statements, identity | Title details, first mortgage statement, exit evidence, identity |
Sources: ASIC, Regulatory Guide 273, Mortgage brokers: Best interests duty, read 7 October 2026. ASIC, Information Sheet 207, Disputes about commercial loans, read 7 October 2026. Panel, pay and document rows are general practice and vary by broker and lender.
Why do caveat loans sit outside most mortgage broker panels?
Caveat loans sit outside most mortgage broker panels because those panels are built around home loans, and private funders do not fit the model. A panel lender offers products with published policy, a servicing calculator and a consumer credit compliance process the broker can run the same way on every file. Private funders work differently. Many lend from their own capital or a fund, decide each deal on its own security, and are not set up for accreditation through a broker group.
For the funder, a caveat loan is a property and exit decision, not an income decision. That is why the panel tools a home loan broker relies on, the calculators and the policy guides, tell you very little here. Even the non-bank lenders on a typical panel lend against registered mortgages, not caveats. Our non-bank lender policy matrix shows where those lenders stop and where private lending starts.
The practical result: a broker without private funder relationships cannot submit your deal anywhere. They are not refusing you. Their system has no button for it.
When does a mortgage broker refer you to a private lending specialist?
A mortgage broker refers you to a private lending specialist when the deal needs a funder outside their panel, the timing is too short for a bank, or the security and exit matter more than the paperwork. In deals I've seen, the referral usually comes after a bank or non-bank has already said no, or when the deadline is days, not weeks.
Common triggers include a tax or supplier debt that needs clearing quickly, a business opportunity that will not wait for a full bank assessment, income documents that do not suit a standard lender, or an existing first mortgage that means the caveat lender will need first mortgagee consent or a clear plan without it. A specialist who places private lending every week knows which funders take which property types and which exits they will accept.
Your broker can place it
- They deal directly with private funders, not only panel lenders
- They have placed short-term property-secured loans before
- They ask about your exit before they ask about rates
- They put their pay and the funder's fees in writing early
It needs a private lending specialist
- Their panel covers banks and non-bank lenders only
- They are unsure how a caveat ranks behind your first mortgage
- They cannot say which funders lend on your property type
- This would be the first caveat loan they have placed
A good referral is not a hand-off and a goodbye. Your home loan broker can stay in the picture, especially if the exit is a refinance back to a bank later. Our private lending guide sets out how the two kinds of lending fit together.
How is a broker paid on a caveat loan?
On a caveat loan, a broker is paid by lender commission, a broker fee or both, disclosed in writing before you commit. That differs from most home loans, where the lender typically pays the broker and you may never see a broker fee at all.
Private funders vary. Some pay the broker a commission out of their own fee. Some expect the broker to charge you directly, and that fee is often deducted from the loan amount at funding. Some deals carry both. None of these is wrong on its own. What matters is that you know the total before you sign, and whether any fee is payable if the loan does not fund. Ask for every fee in one document: the funder's establishment fee, the broker's fee, legal costs and anything taken from the advance.
Our guide to broker fees and commissions in business finance covers how these are usually structured. If you are weighing a broker against going straight to a funder, see a caveat loan through a broker or direct to a private funder.
Does the mortgage broker best interests duty apply to a caveat loan?
The best interests duty sits in consumer credit law, so a caveat loan taken for a business purpose generally falls outside it. The duty is in Part 3-5A of the National Consumer Credit Protection Act 2009 and covers mortgage brokers giving credit assistance on consumer loans. ASIC's guidance is in Regulatory Guide 273.
ASIC's own information on commercial loans makes the gap plain: business borrowers get the lowest level of protection, and a lender that makes only commercial loans does not need a credit licence or membership of the external dispute scheme. In plain terms, the rules that make a home loan broker put your interests first, and give you a free complaints path against the lender, may not reach a caveat loan.
That does not mean a broker can do as they please. General law, misleading conduct rules and the broker's own licence conditions still apply. But the protection that counts most on a caveat loan is the one you build yourself: a written recommendation that explains why this funder and this structure, a full fee disclosure, and your own solicitor reading the loan contract before you sign. A broker who works to the best interests standard anyway will not mind putting that in writing.
What has ASIC said about private credit?
Private credit is under closer ASIC scrutiny in 2026. On 18 June 2026 ASIC put private credit funds on notice over valuations, governance and investor disclosure as signs of credit deterioration emerge, naming property development among the sectors under pressure.
For a borrower, the effect shows up in the deal rather than the headlines. Funders that answer to their own investors are asking harder questions about valuation and exit before they issue an offer, and some are more careful about late changes. The usual result is a slower first conversation and fewer surprises at the end. Our post on who caveat lenders are and why they pull out covers the funders themselves, including how much of the market private credit makes up.
For a broker, scrutiny of the funder side means more care over which funders they introduce you to. Ask your broker how they vet a funder and how long they have worked with it. The overview of the product itself, including its main risks, is in our caveat loans guide.
What does your broker need from you for a caveat loan?
Your broker needs the property, the debt already on it, the exit and the people, in that order. A caveat lender decides quickly when the file answers those four questions on the first read, and stalls when it does not.
- Title and property details. The address, the registered owners, the property type and anything already registered on the title.
- First mortgage statement. A recent statement showing the balance and that repayments are up to date.
- Exit evidence. A sale contract, a refinance approval in progress, or proof of the incoming funds that will repay the loan.
- Identity for every owner and director. Each person on title or guaranteeing the loan will need to be identified.
- Company and purpose details. The business that will use the funds and a short, honest statement of what the money is for.
- Your solicitor's details. The funder's lawyers will deal with yours on the loan documents and the caveat.
If you have a first mortgage, your broker will also need to know whether its terms say anything about further charges, and whether consent from the first mortgagee is needed. Our post on what a caveat lender checks first shows the order they read the file in, and how a caveat loan is discharged and removed covers the end of the deal.
What are the red flags in a broker's caveat loan recommendation?
The red flags in a caveat loan recommendation are a missing exit, missing paperwork and pressure. Watch for these:
- No written disclosure of pay. The broker will not say how they are paid or how much until the documents arrive.
- No talk about the exit. The recommendation covers the rate and the speed, but not how and when the loan is repaid.
- Payment to the broker before any offer exists. A broker asking for money before a funder has issued an offer should explain exactly why.
- Same-day pressure to sign. Urgency is real on many caveat deals, but you should still have time for your solicitor to read the contract.
- A plan to roll into another short-term loan. If the exit is simply a second caveat loan, the cost compounds and the problem moves rather than ends.
- Advice to describe a personal need as business purpose. That is a serious problem for you, not a paperwork shortcut. See the business purpose declaration.
None of these are about the broker's title or size. A small specialist can be excellent and a large firm can get this wrong. For the wider set of property-secured options, start at the Property Lending Hub.
Most mortgage brokers are built for home loans, and caveat loans come from private funders outside most mortgage broker panels. Your broker can place one only if they deal with those funders directly; otherwise a referral to a private lending specialist is the right call, not a rejection. On a caveat loan the broker is paid by lender commission, a broker fee or both, disclosed in writing, and the best interests duty sits in consumer credit law, so a business-purpose loan generally sits outside it. With private credit under closer ASIC scrutiny, the protection that matters most is a written recommendation, a full fee list, a clear exit and your own solicitor.
Key takeaway: ask your broker three questions before anything else: do you place caveat loans, how are you paid on one, and what is my exit.Frequently Asked Questions
Mortgage brokers can do caveat loans when they have access to private funders, but many home loan brokers do not. Caveat loans sit outside most mortgage broker panels, so a home loan broker will often refer you to someone who places them regularly. Our caveat loans guide explains how the product works and how a caveat loan differs from a mortgage.
You find a caveat loan broker in Australia by asking how many caveat or private loans they place, which property types their funders accept, and how they disclose their pay. A broker who places private lending often will answer all three without hesitation. If you are deciding between a broker and a funder, see a caveat loan through a broker or direct to a private funder.
What not to say to a mortgage broker is anything that is not true, and the bigger risk is leaving things out. Tell your broker about the urgency, the debts, any arrears and your real exit strategy, because a caveat funder will find them anyway. A broker who knows the full picture can match you to a funder that will actually say yes.
Your broker can often refinance you out of a caveat loan later, provided the reason you needed short-term money has been dealt with and your file suits a longer-term lender. Planning that refinance before the caveat loan starts makes it far more likely to work. See refinancing with a caveat on title for how lenders treat a caveat already on the property.
Mortgage brokers often do charge a fee for caveat loans, unlike most home loans where the lender pays the broker. You may pay lender commission, a broker fee or both, and every amount should be disclosed in writing before you sign. Our guide to broker fees and commissions explains the usual structures.
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