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How much does a mortgage broker charge?

3 mins read
by Nick Green
Last updated Tuesday, February 6, 2024

Learn everything you need to know about mortgage broker fees. From payment types to overall costings, discover more below.

The cost of mortgage advice can vary from around £400-£500 to no fee at all, with the mortgage broker instead receiving a commission from the lender.

Sometimes, the broker will charge one or the other, and in some cases, they will receive both a fee and a commission.

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Paying a mortgage adviser – fees or commission?

You have the right to know in advance how your mortgage broker will be paid.

Remember to ask them whether they take a fee from you, a commission from the bank or lender, or both.

You should also ask how much the fee and/or commission will be, and confirm that any fee you pay will depend on the mortgage deal going ahead.

Some mortgage brokers will let you decide whether to pay a fee or let them take a commission instead.

Mortgage broker fees or commission – which is better?

There is no major disadvantage to having a mortgage broker paid via commission instead of a fee.

A broker paid by a commission should still be able to give you independent advice on the best mortgage deal for you, but you should ask about this upfront.

Check that your mortgage adviser isn’t tied to just a few providers and can advise you on all available products.

Sometimes, however, it may be worth your while to pay an upfront fee if this means getting the best possible mortgage deal.

This can happen if the broker finds that the best deal for you will not pay a commission (or not enough to justify their work).

It may be that this deal represents better value for you in the long term, so will repay the cost of the adviser’s fee over time.

If your mortgage broker does charge you a fee, ask them to explain why, so you can be sure it is providing value for money.

How much commission do mortgage brokers receive?

Most mortgage lenders will pay brokers a commission, or procuration fee, of about 0.35% of the loan size.

This means that, for a £100,000 mortgage, a typical commission would be £350. You don’t pay any of this, and it doesn’t affect your costs in any way.

However, it is still worth finding out what commission your broker would be paid as you need to be sure they are choosing the deal that is best for you.

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How big a fee should a mortgage broker charge?

A mortgage broker’s fee can vary from around 0.35% of the loan size to up to 1%. So, for a mortgage of £150,000, a 0.35% fee would amount to around £500.

Make sure you confirm your mortgage broker’s fee in advance with a written quote.

Also, get written confirmation that if your mortgage deal falls through, there will be no fee to pay.

Remember that using a mortgage broker should mean you spend less money over the long term, so have the adviser explain to you how their fee is justified.

Is a mortgage broker’s fee worth the money?

A mortgage broker’s fee can be made back quickly if your deal is even slightly better than the next best offer available.

For example, suppose you were to borrow £150,000 at an interest rate of 5%. Your monthly repayments would be £877, and you’d repay a total of £263,162 over 25 years.

If your mortgage broker could improve on that by even 0.1% (giving you a rate of 4.9%), then you’d repay £868 per month and a total of £260,411 – saving you £2,751.

Allowing for a £500 broker fee, this still saves you £2,251, and you’d make back the £500 fee after a few years.

Bear in mind this example is illustrative only (you should consider remortgaging every few years), but it shows how even a small difference in interest rates over time can result in big savings.

In reality, a mortgage broker can often beat high street deals by more than this amount, making it worth seeking advice every time you remortgage.

For this reason, even with a broker who is paid by commission, it’s worth asking them if there are better deals out there that can be accessed for a fee.

Make sure to try our mortgage calculator to work out how much you could borrow.

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Nick Green
Nick Green is a financial journalist writing for, the site that has helped over 10 million people find financial, business and legal advice. Nick has been writing professionally on money and business topics for over 15 years, and has previously written for leading accountancy firms PKF and BDO.