Direct answer
Master broker or packager: what each does and costs
In second charge lending the two terms overlap, and many firms do both. As commonly used, a master broker takes the referred client and gives the regulated advice. A packager sources, packages and manages the case with the lender while the introducing adviser keeps the advice.
Before referring, ask who advises, who owns the client relationship, what the client pays and whether it is added to the loan, and what you are paid. The FCA found intermediary fees on second charges typically ran at 10% to 12.5% of the loan and were rarely published.1
Key points
- Master broker: the specialist advises your client. Packager: you advise, the specialist does the casework.
- Directly authorised firms with mortgage permissions can use either route.
- The FCA found intermediary fees from 2.5% to 15% of the loan, mostly 10% to 12.5%.
- Fees added to the loan accrue interest for the whole term.
- Ask whether the firm will advise your client on anything else.
01
Two roles, often one firm
Firms use the two terms differently, and many offer both. The useful distinction is who gives the regulated advice. If the specialist advises and arranges the loan, it is acting as a master broker. If you remain the adviser and the specialist sources, packages and manages the application with the lender, it is acting as a packager.
| Master broker route | Packager route | |
|---|---|---|
| Who advises the client | The specialist | You |
| Your permissions | None needed to introduce, if article 33A is met | Mortgage advice and arranging permissions |
| Who talks to the client | Mainly the specialist | Mainly you |
| Casework with the lender | The specialist | The specialist |
| How you’re paid | A share of fees or commission, disclosed to the client | Your own advice fee or commission, plus any agreed split |
02
What the FCA found on fees
The FCA’s March 2026 review found intermediary fees on second charges ranged from 2.5% to 15% of the loan, with most between 10% and 12.5%, on top of lender fees. They were rarely published online, often appeared only at the recommendation stage, and were frequently added to the loan. Many firms could not explain how they set them.1
A fee added to the loan is repaid with interest over the full term, so it costs the client more than the headline figure. It also changes the break-even point of a consolidation.
03
Questions to ask before you refer
Whichever route, these answers tell you whether the arrangement works for your client and for you.
- Who gives the advice, and under whose FCA authorisation?
- Will the firm advise my client on anything other than what I refer?
- What will my client pay, in pounds, and is it added to the loan?
- What am I paid, when, and how is it disclosed to the client?
- How wide is the lender panel, and can the firm explain why a lender was chosen?
- Can I see the case progress, and what record is kept of consent and advice?
04
How Charles Frank works
Charles Frank Finance works both ways. Directly authorised firms can keep the advice and have us package the case, or refer it for full advice. We only advise on what you refer, and we never cross-sell to your client. Commission is paid within 48 working hours of completion, and every case stays visible in your portal with a full audit trail.
Common questions
Questions answered
What is the difference between a master broker and a packager?
A master broker advises the client you refer and arranges the loan. A packager sources, packages and manages the case with the lender while you remain the adviser. Many firms offer both.
Do I need FCA permissions to use a packager?
To keep the advice, yes: your firm needs permissions to advise on and arrange regulated mortgage contracts. Without them you can introduce the client to a firm that advises, if you meet the article 33A conditions.
How much do second charge intermediaries charge?
The FCA’s March 2026 review found intermediary fees from 2.5% to 15% of the loan, mostly 10% to 12.5%, on top of lender fees, and often added to the loan.
Should a broker fee be added to the loan?
Only if the client understands it will be repaid with interest over the term and the total cost has been compared. Fees added to the loan raise the total repayable and change the break-even point.
Evidence
Sources and review
Material factual claims were checked against the primary and public-interest sources below. Product criteria and the wider market can change after the review date.
- 1Second charge mortgages: improving outcomes for consumers (12 March 2026)
Financial Conduct Authority. Intermediary fee levels, publication and fees added to loans.
- 2The Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, article 33A
legislation.gov.uk. Introducing without arranging permission, and the disclosure conditions.
Published 27 October 2026. Last reviewed 27 October 2026.