A growing number of mid-career mortgage brokers in Australia are leaving franchise models, driven by structural changes in the industry that have reduced the value proposition of the franchise model relative to independent aggregator arrangements.
High ongoing fees. Franchise models charge ongoing fees — often a percentage of upfront and trail commissions — in exchange for brand rights and infrastructure. As independent aggregators have improved their technology and lender access, the incremental value of the franchise brand has diminished for established brokers with their own client base.
Retail lease obligations. Many franchise models require brokers to operate from a branded shopfront, creating fixed overhead costs that do not apply to independently operated broker practices.
Limited lender panels. Franchise aggregators sometimes offer smaller lender panels than independent equivalents, limiting the broker’s ability to find the best product for clients across the full market.
Technology. Franchise systems have not always kept pace with the technology available through independent platforms, creating efficiency disadvantages for brokers managing high loan volumes.
Trail book ownership. The treatment of trail book on exit has been a concern in some franchise structures — brokers want certainty that the trail book they have built belongs to them.
For established brokers writing $30M–$60M per annum, the economics of leaving a franchise and joining an independent aggregator model with no ongoing franchise fee are often compelling. The transition requires careful management of contract terms, trail book protections, and client communication.
