A co-broker agreement is a written contract between two brokers or brokerages that sets out who does what on a shared loan file and how the income divides. The components that matter most are the same across almost every deal: named parties with defined roles, a precise scope of work, an exact commission formula, payment timing and a clean exit path.
This article walks through those components as a checklist you can apply to your own template, plus the compliance clauses Australian mortgage brokers should never leave out.
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What Is A Co-Broker Agreement?
In mortgage broking, a co-brokered file usually appears when one broker brings the client and another holds the lender accreditation, licence coverage or specialist expertise the loan needs. The agreement records that partnership in writing so both sides know their duties, their share of the trail and what happens if the relationship sours mid-deal.
Without a written agreement, disputes over who introduced the client, who owns the trail and who carries compliance responsibility get settled by memory, and memory always favours the person telling the story.
The Components Your Template Needs
Parties And Roles
Name every party exactly as it appears on their Australian Credit Licence, credit representative registration or company records. Then assign roles: who owns the client conversation, who prepares and lodges the file, who answers the lender’s questions and who signs the credit guide. Vague role lists cause more co-broking arguments than money ever does.
Scope Of Work
Tie each obligation to the transaction at hand rather than describing a general partnership. Cover which lenders and products the agreement covers, whether it extends to future loans for the same client, and what neither party will do, such as contacting the other’s client directly for separate business.
Commission Splits And Fees
State the upfront and trailing commission percentages in numbers, not adjectives, along with how costs such as marketing, referral fees or administrative expenses divide. If the split changes based on who sourced the client or who holds the accreditation, spell out each scenario. Ambiguity here is the single most common source of co-broking disputes.
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Payment Terms
Record when payments flow: on settlement, after clawback risk periods pass or on another trigger. Include the method, the timeframe after funds clear and what happens if a payment arrives short or late. Clawback deserves its own clause, because a reversed commission twelve months later should not become a surprise debt argument.
Compliance Clauses Worth Adding
Both brokers remain responsible for meeting their credit and privacy obligations on a shared file, so the agreement should say so. Cover conflict-of-interest disclosure, the handling of client personal information and the fact that each party keeps current licence or registration coverage. Clear disclosure obligations also help you build trust with the client, who should understand from the start who is advising them and how each broker is paid.
Add a term confirming the arrangement complies with your licensee’s and aggregator’s policies on fee sharing, because many licensees require written approval before a member splits commission with an outside party. Skipping that approval is a mistake no template clause can repair afterwards.
Insurance Requirements
A practical template requires each party to hold current professional indemnity insurance at a stated minimum cover level and to provide evidence on request. If a claim emerges from a shared file years later, you want certainty about the other side’s cover before problems surface, not during one.
Duration, Termination And Disputes
Give the agreement a defined life, such as the length of the loan process or a fixed term with renewal options. Add termination grounds covering breach, insolvency or mutual agreement, a notice period that lets files transfer cleanly, and a dispute path that starts with mediation before anyone reaches for litigation. For trail commissions that run past the agreement’s end date, specify how long the split continues.
Client Ownership After The Deal
Say who retains the client relationship once this transaction settles. If the introducing broker keeps the client but the accrediting broker handles future lending, write that down, including whether referrals between you carry a fee. Handling ownership now prevents the awkward conversation after a client asks both of you for a rate review.
Execution Details That Keep It Enforceable
- Signatures: every named party signs, and each signatory has authority to bind their entity.
- Effective date: state when obligations begin, especially where the agreement precedes lodgement by weeks.
- Witnessing: follow your licensee’s execution requirements; some prefer witnessed signatures for higher-value arrangements.
- Copies: give every party an executed copy and store one with your compliance records.
Conclusion
A strong co-broker agreement comes down to specifics: named parties, numbered percentages, dated payments and a written exit. Everything vague gets renegotiated at the worst possible moment.
Before your next shared file, update your template against the sections above, have a lawyer review the final wording once, and confirm your licensee’s approval process for commission sharing. Those three steps turn a handshake arrangement into something that protects both sides of the deal.
