TL;DR: A UK mortgage agent or mortgage broker typically charges either a flat fee (commonly 300 to 1,000 pounds on standard residential cases), a percentage of the loan amount (often capped, usually below 1 percent), or no client fee at all (relying instead on the procuration fee paid by the lender). The fee structure must be disclosed to the borrower in writing at the outset under the FCA's Mortgage Conduct of Business Sourcebook rules, including when the fee is payable and whether any part is refundable if the mortgage does not proceed. Brokers also receive a procuration fee from the lender on completion, normally 0.3 to 0.45 percent of the loan amount on mainstream residential cases. The procuration fee is built into the lender's pricing and is not separately charged to the borrower.
Last reviewed May 2026
A mortgage agent (more commonly called a mortgage broker or, in regulated terms, a mortgage adviser) is paid by some combination of a fee charged directly to the borrower and a commission paid by the lender. The FCA regulates the disclosure and conduct of these fees under the Mortgage Conduct of Business Sourcebook (MCOB). A reasonable working knowledge of the fee structure helps a borrower compare quotes and understand the total cost of getting the mortgage in place.
This guide explains exactly what UK mortgage agent fees look like in 2026, the standard fee structures, the procuration fee paid by lenders, how the FCA rules apply, when fees are payable, what is refundable, and how to compare two broker quotes that look different at first glance.
The two income sources for a mortgage agent
UK mortgage agents earn from two distinct sources on each case. The client fee is the amount charged directly to the borrower for the broker's advice and the work of getting the mortgage in place. The procuration fee is the commission paid by the mortgage lender to the broker (or to the principal firm in an appointed representative structure) when the mortgage completes.
Both sources must be disclosed to the borrower under the FCA's MCOB rules. The combined disclosure appears in the Initial Disclosure Document (IDD) at the start of the engagement and in the European Standardised Information Sheet (ESIS) or the equivalent disclosure attached to the mortgage offer. The borrower can see the procuration fee figure on the offer document; it is not a hidden cost, but it is built into the lender's pricing rather than separately charged.
The combination of client fee and procuration fee makes up the broker's gross income on the case. The broker pays operating costs (professional indemnity insurance, FCA fees, software, marketing) and, in an appointed representative structure, a share of gross income to the principal firm. The net income to the broker is therefore meaningfully smaller than the gross figure.
Common client fee structures
Three client fee structures dominate the UK mortgage broker market. The flat fee model charges a fixed amount per case, regardless of the loan size. Typical flat fees on standard residential cases run from 300 pounds at the lower end to 1,000 pounds at the higher end, with specialist or complex cases (adverse credit, expat, large loan, buy-to-let portfolio) often higher.
The percentage fee model charges a fraction of the loan amount, often with a minimum and a cap. A typical structure is 0.4 percent of the loan with a minimum of 500 pounds and a cap of 2,000 pounds, or similar variations. Percentage fees scale with the loan size, which can produce higher fees on large loans but lower fees on smaller ones.
The no-client-fee model charges nothing to the borrower directly. The broker relies on the procuration fee from the lender as the sole income on the case. This model works in segments where the average loan size is large enough that the procuration fee alone covers the cost of advising and processing the case. Some brokers offer a no-fee proposition as a marketing differentiator.
Procuration fees and how they affect borrowers
The procuration fee is paid by the lender to the broker after the mortgage completes. The fee is built into the lender's product pricing, not separately added to the loan. Procuration fees on mainstream residential mortgages typically run 0.3 to 0.45 percent of the loan amount. On buy-to-let and specialist mortgages, procuration fees are often higher, reflecting the more complex underwriting and smaller volumes.
The borrower does not see the procuration fee as a line item on their offer separately from the interest rate, because the procuration fee is part of the lender's overall acquisition cost reflected in the rate. Borrowers should not assume a no-client-fee broker is "free" in cost terms; the procuration fee is still being paid by the lender, and the lender's overall pricing reflects it.
The FCA's Consumer Duty rules introduced in 2023 require brokers to act in the borrower's best interests. Recommending a higher-priced product purely because it pays a higher procuration fee would breach the rules. The broker must be able to evidence that the recommended product is suitable for the borrower's needs and circumstances, not chosen for the broker's benefit.
When fees are charged and what is refundable
The FCA's MCOB rules require disclosure of when the client fee is payable. Three timing models are common: a small initial fee on engagement (sometimes 100 to 300 pounds) plus the balance on completion; the full fee on application (paid when the mortgage application is submitted to the lender); or the full fee on completion (paid when the mortgage funds are released).
Fees paid on application are usually only partially refundable if the mortgage does not complete. The disclosure document states whether (and how much) is refundable, and under what circumstances. Fees paid on completion are not at risk if the case falls through before completion, because the fee is not yet due. Brokers operating a no-client-fee model carry the full risk of a case falling through, because they receive nothing if the case does not complete.
The Financial Ombudsman Service handles complaints about broker fees that are not refunded where the consumer considers they should be. The FOS examines the disclosure document, the work done by the broker, and the circumstances of the failure to complete to determine whether the fee retained was reasonable.
How to compare two broker quotes
The first comparison is the total cost of getting the mortgage in place: client fee + lender arrangement fees + valuation fee + any other broker-payable cost. Two brokers might quote 0 pounds and 1,500 pounds in client fees respectively, but the broker with the higher fee might be recommending a product with a lower rate or smaller lender arrangement fee, producing the lower total cost over the fixed term.
The second comparison is the total cost over the fixed term of the mortgage. A 2-year fixed at a slightly higher rate with no client fee can cost more (or less) than a 2-year fixed at a slightly lower rate with a 1,000 pound broker fee. The arithmetic depends on the loan size. The broker should be able to produce a "total cost" comparison covering both scenarios.
The third comparison is service and case-by-case fit. A broker who specialises in the borrower's specific situation (first-time buyer, complex income, buy-to-let portfolio, adverse credit, age over 60) is often worth a higher fee than a generalist whose strongest lenders are not the right ones for the case. Specialist case knowledge can produce a better product fit and a smoother case journey, both of which have real value.
Whole-of-market versus limited panel brokers
A whole-of-market broker has access to (substantially) all UK mortgage lenders that distribute through brokers. A limited-panel broker has access to a smaller pre-selected group of lenders. The FCA's MCOB rules require the broker to disclose the scope of the market the broker covers, and to choose between "advised" and "non-advised" sales (most UK broker sales are advised).
Some lenders distribute only through brokers; some distribute only direct to the consumer; many distribute through both. A whole-of-market broker can access the broker-only products, which can be a meaningful advantage over going direct to the borrower's own bank. The broker should be able to confirm whether the recommended product is broker-only or also available direct.
Tied brokers (those tied to a specific lender, often as a representative of an estate agent's in-house mortgage desk) have a narrower remit. The recommendation is limited to the panel of lenders the broker is tied to. Tied brokers can still produce a good outcome where the panel covers the borrower's needs, but the borrower should be aware of the scope.
How we verified this
This article reflects the FCA's Mortgage Conduct of Business Sourcebook (MCOB) for the disclosure and conduct rules on broker fees and procuration fees, the FCA's Consumer Duty rules introduced in 2023 for the requirement to act in the borrower's best interests, the Financial Ombudsman Service guidance on the handling of broker fee disputes, and the FCA Financial Services Register for the regulated status of mortgage brokers. Specific fee levels in the market change over time and the disclosure document for any particular broker is the authoritative reference for that broker's fees.
Disclaimer: This article is general information about UK mortgage agent and broker fees. It is not financial advice. Specific fees and product availability vary by broker and by case. Anyone seeking mortgage advice should check the broker's Initial Disclosure Document, ask for a full breakdown of the client fee and procuration fee on each recommendation, and check the broker is authorised by the FCA on the Financial Services Register.
Frequently asked questions
How much do mortgage agents charge in the UK?
UK mortgage brokers typically charge either a flat fee (300 to 1,000 pounds on standard residential cases), a percentage of the loan amount (often capped), or no client fee at all. The fee structure must be disclosed in writing under FCA Mortgage Conduct of Business Sourcebook rules. The broker also receives a procuration fee from the lender, typically 0.3 to 0.45 percent of the loan amount on mainstream residential cases.
Do mortgage brokers charge a fee on top of the lender's fees?
The broker's client fee is separate from the lender's arrangement fee, valuation fee, legal fees and any other case costs. The broker's fee compensates the broker for the advice and case work; the lender's fees compensate the lender for product set-up and the underwriting work. The total cost of getting the mortgage in place is the sum of all of these.
Are mortgage broker fees refundable if the mortgage falls through?
The position depends on when the fee is paid and what the broker's disclosure document states. Fees paid on completion are not at risk if the case does not complete. Fees paid on application are sometimes partially refundable if the case fails. The Initial Disclosure Document sets out the broker's specific terms; the Financial Ombudsman Service handles complaints where retention is disputed.
What is a procuration fee and does it affect my mortgage rate?
A procuration fee is the commission paid by the lender to the broker on completion, typically 0.3 to 0.45 percent of the loan amount on mainstream residential cases. The fee is built into the lender's product pricing and is not separately added to the loan. The FCA's Consumer Duty rules require the broker to recommend a product on the basis of suitability for the borrower, not the size of the procuration fee.
Are fee-free mortgage brokers really free?
The broker is paid by the lender through a procuration fee on completion, so the broker is not literally working unpaid. The borrower does not pay the broker directly. The lender's pricing reflects its acquisition costs, including the procuration fee, so the "cost" exists in the lender's pricing rather than as a separate broker invoice. A no-client-fee broker can still produce a competitive total cost compared with a fee-charging broker, depending on the case.
