Mortgage Fees Explained (2026): Every Cost of Getting — and Leaving — a Mortgage
Product fees, valuation fees, legal costs, broker fees, early repayment charges — the price of a mortgage is much more than its interest rate. Here’s every fee you’ll meet, what’s typical, which ones you can avoid, and how to compare deals on what they really cost.
Quick Answer
Mortgage fees fall into three groups: getting the mortgage (product/arrangement fee £0–£1,500, valuation, legal and application costs — though remortgage deals often include free valuations and legals), having the mortgage (nothing extra, if you keep up payments), and leaving early (an early repayment charge of typically 1–5% of the balance if you exit a deal before it ends, plus a small exit fee).
Broker fees are the pleasant surprise: many brokers charge nothing to you, because the lender pays them a commission. The golden rule for all of it: judge deals on total cost over the deal period — a low rate with a big fee is often beaten by a slightly higher rate with none. Your home may be repossessed if you do not keep up repayments on your mortgage.
On this page
Every Mortgage Fee at a Glance
| Fee | Typical amount | When you pay it | Avoidable? |
|---|---|---|---|
| Product / arrangement fee | £0 – £1,500 (occasionally more) | On taking the deal — upfront or added to the loan | Yes — fee-free deals exist, at a slightly higher rate |
| Booking / application fee | £0 – £300 | On applying; usually non-refundable | Often — many lenders don’t charge one |
| Valuation fee | £0 – £500ish | During the application | Often free, especially on remortgage deals |
| Legal / conveyancing | £300 – £1,500 (purchase) | During conveyancing | On remortgages, free legals are standard |
| Broker / adviser fee | £0 – £500 typical | On advice or completion | Yes — many brokers are free to you (lender-paid) |
| Early repayment charge (ERC) | 1 – 5% of balance | Only if you leave a deal before it ends | Yes — by timing, porting, or choosing no-ERC deals |
| Exit / discharge fee | £0 – £300 | When the mortgage is fully closed | Rarely — but it’s small |
Buying your first home? Remember these sit on top of the deposit and moving costs — our first-time buyer hub covers budgeting for the whole picture. The sections below take the fees that cause the most confusion (and the most search queries) one at a time.
Product & Arrangement Fees: The Price of the Deal Itself
The product fee — also called an arrangement fee or completion fee — is what the lender charges for the deal itself. It’s the price tag on that attractive interest rate, typically £0 to £1,500, with some deals (especially buy-to-let, where fees are sometimes a percentage of the loan) charging more.
Is it worth paying a product fee?
Sometimes — it’s pure maths. Deals with fees usually carry lower rates, so the question is whether the interest saved over the deal period beats the fee. As a rule of thumb: the bigger your mortgage, the more likely a fee-paying deal wins (a lower rate saves more on a large balance); on smaller mortgages, fee-free frequently comes out ahead. Run both numbers — or have a broker run them — before assuming the lowest rate is the cheapest deal.
Pay upfront or add it to the loan?
Most lenders let you add the product fee to the mortgage instead of paying upfront. Convenient — but you’ll then pay interest on the fee for the life of the loan, which can turn £1,000 into considerably more over 25 years. If you can comfortably pay it upfront, that’s usually cheaper; if cash is tight at completion, adding it is a reasonable trade, made with eyes open.
Valuation & Legal Fees: The Process Costs
- Valuation fee. The lender’s check that the property is worth what’s being lent against it — a basic mortgage valuation, not a survey of the property’s condition. Cost scales with property value, but free basic valuations are common, near-universal on remortgage deals. (A proper survey for your own protection — a Level 2 or 3 report — is a separate, worthwhile cost when buying.)
- Legal / conveyancing fees. A solicitor must handle the legal side. On a purchase, expect roughly £300–£1,500 plus searches. On a remortgage, free legal work is standard — the lender appoints and pays the solicitor — so switching deals usually costs little or nothing in legal fees.
- Booking / application fees. A small upfront charge some lenders make to secure a deal — usually non-refundable, so worth knowing about before you apply rather than after.
Early Repayment Charges (ERCs) & Exit Fees: The Cost of Leaving
The early repayment charge is the fee that matters most, because it’s the biggest — and the most avoidable. It’s what your lender charges if you repay or leave a deal before its tie-in period ends: typically 1–5% of your outstanding balance, which on a £200,000 mortgage means £2,000–£10,000. You’d trigger it by remortgaging away mid-deal, repaying the whole loan (e.g. selling up without porting), or overpaying beyond your allowance.
How ERCs usually behave:
- They step down over time. A 5-year fix might charge 5% in year one, 4% in year two, and so on — so leaving late in a deal costs far less than leaving early.
- They apply during the deal period, not the whole term. Once your fixed or deal period ends, you can leave freely — which is why remortgaging is timed to that moment, and why sitting on the SVR afterwards has no exit penalty.
- Overpayment allowances are your friend. Most deals let you overpay around 10% of the balance each year without triggering the ERC — generous enough for most people’s spare cash.
Ways to avoid or soften an ERC: time your switch to the end of the deal (you can line up the next deal 3–6 months ahead); port the mortgage when moving home, taking the deal with you instead of repaying it; check the maths anyway — occasionally a much cheaper deal saves more than the ERC costs, which is a calculation worth doing properly; or if flexibility matters to you from the start, choose a deal with no ERC at all — some trackers and specific products carry none, in exchange for a rate premium. If you’re weighing an ERC against borrowing more, note that a second-charge mortgage exists precisely to raise money without breaking a good deal and paying its ERC.
ERC vs exit fee — don’t confuse them
The exit fee (also called a discharge, redemption admin or deeds release fee) is different: a small flat admin charge — up to a few hundred pounds — for closing the mortgage account, whenever that happens. Nearly everyone pays it eventually; it’s the ERC, not the exit fee, that deserves your planning.
Mortgage Broker Fees: What Does Advice Cost?
Here’s the fee people are most suspicious of — and the one with the friendliest answer. Brokers are paid in one or both of two ways:
Lender commission (procuration fee)
The lender pays the broker a commission — typically a fraction of a percent of the loan — for introducing the business. This is how fee-free brokers make their money: comprehensive advice that costs you nothing directly.
Client fee
Some brokers also charge you a fee — commonly a flat £300–£500, occasionally a percentage of the loan. Complex cases (adverse credit, unusual income) justify it more often than straightforward ones. Whatever the model, brokers must disclose their fees upfront.
Is a broker worth it either way? For most people, yes — access to deals not available direct, lender criteria knowledge that avoids failed applications, and the total-cost comparisons this whole page is about. And for transparency: nextmove’s matching service is free to you — we introduce you to FCA-regulated brokers and may receive a fee or commission from them for the introduction, which never adds to what you pay.
Rates vs Fees: How to Compare What a Mortgage Really Costs
The headline interest rate is designed to catch your eye; the fees decide whether it’s actually a good deal. The comparison that cuts through:
- Total cost over the deal period = (monthly payment × months in the deal) + all fees − any incentives (cashback, free valuation, free legals). Compare deals on this number, not the rate.
- Check the APRC — the “annual percentage rate of charge” on every mortgage illustration folds rate and fees into one comparable percentage across the whole term. It’s imperfect (it assumes you never remortgage) but it’s a useful tiebreaker.
- Watch the revert rate. Every illustration also shows the SVR you’d roll onto after the deal — a reminder that the real cost of any mortgage depends on what you do when the deal ends.
What sets the rates themselves? Broadly: the Bank of England base rate and market funding costs set the baseline; your loan-to-value band (bigger deposit, cheaper rate), credit profile and property type set your price within it; and the type of deal — fixed, tracker, variable — sets how it can move. Deep-dives on LTV bands and how interest is calculated are coming to this hub.
The bottom line
Mortgage fees aren’t small print — on a typical deal they can swing the true cost by more than the rate does. The habits that save money: compare total cost over the deal period, never just the rate; respect the ERC and time your moves around it; take free valuations and legals where offered; and remember that good advice is often free to you.
Compare mortgage deals and we’ll match you with an FCA-regulated broker who prices up your real options, fees and all — free, with no obligation.
Frequently Asked Questions
What is a product fee on a mortgage?
A product fee — also called an arrangement or completion fee — is the lender’s charge for the mortgage deal itself, typically £0 to £1,500. Deals with product fees usually carry lower interest rates, so whether one is “worth it” is a sum: on larger mortgages the interest saved often beats the fee, while on smaller mortgages fee-free deals frequently win. You can usually pay it upfront or add it to the loan — adding it means paying interest on it for the full term.
Do mortgage brokers charge a fee?
Many don’t charge you anything — they’re paid a commission by the lender when your mortgage completes, so their advice is free to you. Others charge a client fee, commonly a flat £300–£500, more often on complex cases. Brokers must disclose how they’re paid before you commit. nextmove’s broker-matching service is free to you; we may receive a fee or commission from the broker for the introduction.
What is an early repayment charge on a mortgage?
An early repayment charge (ERC) is what your lender charges if you repay or leave your mortgage deal before its tie-in period ends — typically 1–5% of the outstanding balance, usually stepping down each year of the deal. You’d trigger it by remortgaging away mid-deal, repaying the loan in full, or overpaying beyond your annual allowance (commonly 10%). Once the deal period ends, you can leave without any ERC.
Can you get a mortgage with no early repayment charges?
Yes. Some mortgages — notably certain tracker and flexible products — carry no ERC at all, letting you overpay, repay or switch at any time. The trade-off is usually a somewhat higher rate than the equivalent tied-in deal, so they suit people who genuinely expect to move, repay early or remortgage soon. Standard variable rates also carry no ERC, though the SVR itself is an expensive place to sit.
What is a valuation fee — and is it the same as a survey?
No, and the difference matters. The valuation fee pays for the lender’s basic check that the property is adequate security for the loan — it’s for the lender’s benefit, often free, and tells you very little about the property’s condition. A survey (a Level 2 HomeBuyer report or Level 3 building survey) is a separate service you commission for your own protection when buying, and it’s money well spent on older or unusual properties.
How much are solicitor fees for a mortgage?
For a property purchase, budget roughly £300–£1,500 in legal fees plus the cost of searches, varying with property price and complexity. For a remortgage, you’ll usually pay nothing: free legal work is a standard incentive, with the lender appointing and paying the solicitor. Paying for your own solicitor on a remortgage is optional — some people do it for speed, since free-legals teams can be slower.
- Financial Conduct Authority (FCA) — Mortgages and Home Finance: Conduct of Business (MCOB) rules, including fee disclosure and APRC requirements
- MoneyHelper — guidance on mortgage fees, early repayment charges and adviser fees
- Bank of England — base rate and mortgage pricing
Important information
nextmove is an introducer, not a lender or adviser. This article is for general information only and does not constitute financial advice. We introduce you to FCA-regulated mortgage brokers who can advise on your individual circumstances, and we may receive a fee or commission for doing so.
Your home may be repossessed if you do not keep up repayments on your mortgage. Fees, rates, allowances and lender criteria change over time and vary by lender — always confirm current figures with a regulated adviser before proceeding.
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