What UK brokers charge, when the fee is payable, what fee-free really means and how to tell whether a fee is buying you anything. A straightforward guide to mortgage broker fees.
A UK mortgage broker can be paid by you, by the lender, or by both. The lender side is the procuration fee, paid on completion. The client side is the broker fee, and it is entirely at the firm's discretion — which is why quotes vary so widely for identical work.
Typical mortgage broker fees
- Fee-free: £0 to the client; the adviser is paid only by the lender
- Flat fee: commonly a few hundred pounds up to around £1,000 for a standard residential case
- Percentage fee: a fraction of a percent of the loan, used mainly by firms handling larger or complex cases
- Specialist and adverse credit: higher, reflecting the additional lender research and packaging involved
- Buy-to-let and portfolio landlords: often priced per case rather than as a single standard fee
When is the fee payable?
This is the question most borrowers forget to ask, and it matters more than the headline number. Some firms charge on application, some on production of a mortgage offer, some only on completion. A fee charged at application is at risk if the case does not proceed; a fee charged on completion is not. The FCA requires the firm to disclose the amount, the trigger and any refund policy in writing before you commit.
What fee-free actually means
Fee-free means the adviser is remunerated by the lender rather than by you. It does not mean the advice cost nothing, and it does not by itself indicate bias — procuration fees are broadly similar across mainstream lenders, and the FCA's suitability rules apply regardless. The more useful questions are whether the firm is whole-of-market or panel-limited, and what it discloses about its remuneration.
"The fee is not the cost. The cost is the fee plus whatever the wrong product does to your interest bill over five years."
What a fee should be buying
- Whole-of-market research rather than a small lender panel
- Access to intermediary-only products not available direct
- Case packaging and lender liaison on complex income or credit history
- A documented suitability rationale you can review
- Contact at the end of the fixed term, not just at the start
That last point is the one most firms under-deliver on. A fee paid once should not buy a single transaction; it should buy a relationship that resurfaces when your rate expires.
Frequently asked questions
- Are mortgage broker fees worth it? Where the case is complex or the broker secures a materially better rate, generally yes. For a vanilla remortgage, a fee-free whole-of-market broker may be equivalent.
- Are broker fees refundable? Depends on the firm. Ask whether the fee is charged at application, offer or completion.
- Can I claim the fee back if the mortgage falls through? Only if the firm's terms say so — check before paying.
- Do brokers charge VAT on fees? Mortgage advice fees are generally exempt, but confirm with the firm.
- Do I pay a fee and the lender pays one too? Often yes; both must be disclosed to you.
For advisers reading this
If your fee model is transactional, your revenue resets every case. The firms that grow without adding headcount are the ones that treat completed cases as a book to be monitored — tracking fixed-rate expiries, product-transfer windows and clients now paying above market. Kayotte does that monitoring alongside your existing systems and returns a prioritised contact list.
Fees vary by firm and case. This article is general information, not financial advice.