Despite banks pushing harder into proprietary lending, rising borrower complexity, regulatory change, and non-standard income profiles will ensure brokers remain at the heart of Australia’s mortgage market in 2026, says Brighten CEO Jason Azzopardi.
Over the past few months, we’ve watched a pattern re-emerge in the mortgage market. Major banks have announced strategies to increase the ratio of proprietary lending at the expense of broker-originated lending, including increased investment in their in-house direct-to-customer lending teams.
To brokers, these moves feel uncomfortably familiar. And for non-bank lenders like Brighten, it highlights a growing divergence in how different parts of the industry view the broker channel.
Why borrower behaviour is shifting faster than bank strategy
The question is whether the majors’ renewed focus on proprietary lending is grounded in customer need.
Nearly 78 per cent of all new residential mortgages are now written by brokers, according to the MFAA, the highest share ever recorded. A decade ago, that figure sat just above 50 per cent.
Borrowers are choosing brokers because they want advice, comparison, transparency, and independence, and they want it in a market that has become dramatically more complex.
ABS data shows that in the September 2025 quarter, new dwelling loan commitments rose 6.4 per cent by number and 9.6 per cent by value. At the same time, Australia’s labour market has shifted materially: around 1.1 million Australians now work as independent contractors. This means more borrowers with income that is variable, multi-sourced, or tied directly to business performance. Credit assessment today is rarely linear and will require interpretation.
Regulation adds yet another moving part. APRA’s incoming February 2026 cap will limit debt-to-income loans higher than 6:1 to 20 per cent of new lending. Many borrowers won’t understand the impact of such policy changes until they’ve already made financial commitments. In practice, this means borrowing power can shift from one quarter to the next based on factors outside the borrower’s control.
The result is a lending environment that is more technical and more sensitive to change than at any point in the past decade. It is unrealistic to assume borrowers will simply revert to bank-led distribution because banks wish to reclaim it. Borrowers seek clarity in a market that no longer provides straightforward answers.
Borrower complexity is the opportunity
The banks’ strategic pivot to proprietary lending will present both challenges and opportunities. Some lenders will narrow product sets or focus on specific borrower profiles; others will prioritise digital origination.
But these shifts do not change the underlying dynamics of the marketplace. If anything, they reinforce the need for a channel that can translate complexity into understanding, and at Brighten, we strongly believe that is the broker channel.
At Brighten, we see this most clearly in the kinds of scenarios coming through our brokers. Construction and vacant-land lending have reached record levels within our portfolio. A growing number of borrowers are navigating multi-step financing: land purchases, construction facilities, sequential valuations, and bridging structures.
We also see more borrowers with income patterns that fall outside traditional credit models, such as business owners and contractors.
A customer embarking on a build is a good example. They may require a land loan, a construction loan, staged valuations, and, depending on timing, a bridging solution. They often need someone to co-ordinate lenders, builders, and valuers; manage disbursement cycles; and anticipate risks along the way. This is not the service model banks have prioritised in recent years.
Recently, we have seen Macquarie, CBA (for new customers), and Westpac withdraw from lending to company/trust structures. This immediate withdrawal placed a number of customers with investment lending strategies under pressure. Brokers can immediately assist their clients to pivot to a lender to fill the void when banks withdraw from segments with immediate effect.
What areas should brokers focus on?
The brokers who thrive in 2026 will be those who lean into the areas where advice carries the highest premium. Construction is one. Self-employed borrowers are another. These are segments the major banks find difficult to service at scale, and they are exactly the scenarios where brokers deepen their value proposition.
At Brighten, we have aligned our strategy with these trends, broadening our product suite and investing in technology designed to support complex or multi-stage workflows rather than standard loan files. We think our construction, expat, and bridging products are unrivalled in the market. We are not limited by loan size up to 80 per cent LVR on any product, and our borrowing capacity compares favourably with the majority of bank and non-bank lenders.
Why brokers remain the stabilising force in a shifting market
The banks may succeed in shifting some lending back into proprietary channels, but it will not reverse the broader trend.
Borrowers have discovered the value of independent advice, and regulatory evolution has only reinforced that discovery.
As complexity rises across income structures, investor activity, valuations, and credit policy, borrowers increasingly want someone who can interpret the landscape.
When interest rates move again, borrowers will turn, as they always do in periods of uncertainty, to the people who guide them through change: their brokers.
The future of lending will not be defined by who controls retail banking distribution. It will be defined by who helps borrowers navigate complexity.
On that front, Brighten believes brokers will remain firmly at the centre of the Australian mortgage market in 2026 and beyond, supported by tech and AI advancements that will materially increase operational efficiency.
Jason Azzopardi is the CEO of non-bank lender Brighten.
