A broker fee (or adviser fee) is a charge you pay to a mortgage broker for their professional advice and service in sourcing, recommending, and arranging a mortgage. Not all brokers charge a fee to the customer — many are paid by commission from the lender instead, or use a combination of commission and a client fee.
Where a fee is charged, it typically ranges from £300 to £1,000 for standard residential mortgages, although it can be higher for complex cases such as adverse credit, self-employment, or large loan amounts. The fee may be structured as a flat amount, a percentage of the loan, or a combination. Some brokers charge the fee on application, while others charge on completion.
Using a broker can save you money overall, even with a fee, because they have access to thousands of mortgage products and can identify deals you might not find on your own. They also handle much of the paperwork and liaise with the lender on your behalf, which can be particularly valuable for first-time buyers or borrowers with complex circumstances.
Your mortgage broker charges a flat fee of £495 payable on completion. They compare products from over 90 lenders and find you a rate 0.3% lower than the best deal you found yourself. On a £200,000 mortgage over 5 years, the lower rate saves you £3,600 in interest — far more than the £495 fee.
Key Points
- Charged by a mortgage broker for their advice and arrangement service
- Typically £300 to £1,000, but varies based on complexity
- Some brokers are fee-free, earning commission from lenders instead
- May be charged on application or on completion
- A good broker can save more than their fee through better deals