Fees in Focus for 2025

When it comes to mortgages, most borrowers ask about interest rates first. But in 2025, with rates shifting almost weekly and products being withdrawn and relaunched at speed, one of the most important questions you should be asking is: What is my broker charging me—and is it fair?

Mortgage broker fees have always varied, but in today’s market the differences can be striking. Some brokers charge nothing upfront, others demand several thousand pounds, and many rely on commission from lenders. Unless you understand how fees are structured and why, you risk either overpaying or being nudged toward a product that isn’t right for you.

In Why Your Mortgage Broker Might Be Costing You Thousands, we explored the risks of poor advice. Here, we go deeper into how broker fees actually work, what’s fair in 2025, and how to ensure you’re getting value rather than simply a bigger bill.

The Three Main Ways Brokers Charge

There are three broad approaches to broker remuneration: fixed fees, percentage-based fees, and commission-only models. While all are allowed under FCA rules, the transparency and fairness of each approach can vary widely.

Fixed fees are often attractive to borrowers who want certainty. You know upfront what you’ll pay, regardless of the loan size. For example, a broker may charge £495 for arranging a residential mortgage.

Percentage-based fees are common at the higher end of the market. A broker might charge 0.5% of the loan amount, which means arranging a £2 million mortgage could cost £10,000 in fees. This model is more justifiable for complex, high-value deals where bespoke structuring is required, such as private bank lending for high-net-worth clients.

Commission-only brokers don’t charge the client directly but are paid by the lender once the mortgage completes. At first glance, this looks like the cheapest option, but it can create conflicts of interest. If a lender pays higher commission than others, is the broker really recommending the best deal for you—or the most lucrative one for them?

Why Fees Vary So Widely in 2025

In the past, brokers were often clustered around a standard fee range. But in 2025, the spread is far broader, partly because of rising compliance costs, partly because of network agreements, and partly due to the growing complexity of client needs.

• First-time buyers may find brokers who charge nothing upfront but rely on lender commissions, hoping to build relationships for future remortgages.

• Buy-to-let landlords often encounter mid-tier fees, as applications are more complex and require deeper lender knowledge.

• High-net-worth clients frequently face higher broker charges, not because brokers are simply “taking more,” but because structuring these loans involves negotiating directly with private banks, interpreting wealth portfolios, and creating bespoke presentations.

At Willow, for example, we may spend weeks packaging a complex expat or HNW application, liaising with lawyers, accountants, and banks to structure the deal. That level of work justifies a higher fee compared to arranging a straightforward residential mortgage.

Transparency: The Real Test of Value

What matters most is not the number, but the clarity. A fair broker in 2025 will tell you:

• Exactly what you’ll pay and when
• Whether the fee is refundable if the mortgage doesn’t complete
• How much commission (if any) they expect to receive from the lender
• Why their fee structure suits your case

Unfortunately, too many borrowers still sign paperwork without understanding these points. The FCA requires disclosure, but as we highlighted in Should You Use a Mortgage Broker or Go Direct in 2025?, disclosure is not the same as understanding. A good broker will break down the numbers in plain English before you sign anything.

Case Study: When Cheap Becomes Expensive

A client recently came to Willow after initially using a “free” broker recommended by a friend. That broker only had access to a restricted panel of lenders and steered the client into a product that offered a higher commission rate. On paper, it looked like a deal—no fee to the client. But the mortgage itself carried a higher interest rate and early repayment charges that cost the borrower over £20,000 more over the life of the loan.

By the time they approached us, we were able to restructure their borrowing with a private bank, reducing the long-term cost dramatically. The lesson: “free” isn’t always free.

When Higher Fees Are Justified

Not every high fee is unfair. Some scenarios genuinely require more work, negotiation, and expertise. Consider:

• A high-net-worth individual seeking a £5 million mortgage with income from multiple jurisdictions.
• A developer needing complex finance involving bridging, development lending, and an exit plan.
• An expat with fluctuating income and foreign currency risk.

In each of these cases, the broker is not just ticking boxes—they are effectively building a financial case and persuading a lender to structure terms that may not exist off-the-shelf. A percentage-based fee in these cases reflects the value delivered, not simply the loan size.

Red Flags in Broker Charging

By contrast, there are warning signs that a fee structure may be unfair:

• Vague explanations of charges, or no written fee agreement.
• Brokers who push one lender disproportionately.
• Non-refundable upfront fees without clarity on what work is covered.
• Excessive charges for straightforward cases.

If you’re unsure, ask the broker to explain why their fee is fair in relation to the work involved. If they can’t answer convincingly, it’s a problem.

Borrower Scenarios: What’s “Fair” for Different Clients

First-Time Buyer

A broker charging £500 for securing a £200,000 mortgage may be offering a fair deal. The work is modest but still requires advice, compliance, and packaging.

Portfolio Landlord

A broker may charge £1,500–£2,000 to refinance multiple properties, reflecting the added complexity of stress testing, portfolio underwriting, and lender negotiation. This aligns with the insights we shared in Portfolio Mortgages in 2025.

High-Net-Worth Borrower

For a £5 million loan negotiated with a private bank, a fee of 0.5% (£25,000) may sound steep—but if the bespoke terms save the borrower hundreds of thousands in interest and structure tax-efficiently, the fee is more than justified. See our guide on How to Get a £5 Million+ Mortgage in 2025.

Looking Ahead: The Future of Broker Fees

In 2025 and beyond, we expect to see even greater divergence in broker fees, driven by:

• Technology: AI will streamline basic cases, potentially reducing fees at the lower end of the market.
• Regulation: The FCA may push for clearer disclosure on commissions to prevent bias.
• Specialisation: As more clients present with complex profiles—expats, landlords, HNW borrowers—fees for expert brokers will likely rise, reflecting the value delivered.

Ultimately, the test will remain the same: clarity, transparency, and outcomes. A broker should be able to demonstrate why their fee is justified and how it benefits you.

How Willow Can Help

At Willow Private Finance, we are fully transparent about our fees. We explain upfront what you’ll pay, when you’ll pay it, and why. Our structure reflects the complexity of your case, not simply the loan amount, and we remain independent, whole-of-market, and committed to acting in your best interests.

Whether you are a first-time buyer or seeking a multi-million-pound loan with a private bank, you will always know exactly what you’re paying for and the value we bring.

📞 Want Help Navigating Today’s Market?

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We’ll help you find the smartest way forward—whatever rates do next.