How do mortgage brokers get paid?

Mortgage broker fees

All mortgage brokers get paid for their mortgage advice, but how that cost is passed onto you varies. You can find out more about what services mortgage brokers offer, or read on for a breakdown of how they make money and charge fees.

The direct broker fees

Mortgage brokers make money:

• By charging you a flat fee of, on average, £500 up-front

• By charging you a fee based on how much you’re borrowing. For example, if you’re borrowing £180,000 they might charge a 1% fee – which amounts to £1,800

• By charging the lender a commission for bringing them your business

The go-to payment method

You’ve probably sussed it out by now, but the commission model is great because it won’t cost you anything.

Commissions are still determined by how big the loan is, but the percentage a broker earns tends to be around 0.35 to 0.45%.Your mortgage broker must declare how much, if anything, they’ll earn from the lender.

Brokers are regulated by the Financial Conduct Authority (FCA), so they shouldn’t let the amount of commission they can earn affect their advice to you. It could cost them their licence, after all.

Double dipping, and how to avoid it

Some brokers will charge you a fee for their advice and then still take a commission from the lender when they secure you a mortgage. Some people call this ‘double dipping’.

Again, brokers who do this should tell you upfront how they make their money, so you’ll know ahead of time. It’s up to you whether you think their service is worth paying for.

How Mojo mortgage brokers make money

At Mojo Mortgages, we won’t charge you a fee for our advice. Instead, we earn money from lenders who pay us a commission when we secure your mortgage with them.

We compare thousands of mortgage deals in under a minute and we can help you get a mortgage in principle in under 15 minutes.