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Mortgages & protection

Know the firms and advisers in your network

For mortgage networks whose ARs are broker firms, estate agency brokers and protection advisers, and the introducers who refer to them.

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Large networks of small broker firms

Mortgage networks are among the biggest principals. Protection runs through the same firms: for mortgage broker networks, pure protection commission is about a third of revenue.

networks with mortgage and home finance permissions (January 2025)
81
ARs at each of the two largest mortgage networks (January 2025)
600+
of mortgage broker networks’ revenue comes from protection commission
~35%

The rules that matter in this sector

Up to four principals, one per type
A home finance AR may have at most one principal each for regulated mortgages, lifetime mortgages, home reversion and home purchase plans, and only one where MCD credit intermediation is involved. Protection has no limit (SUP 12.5.6AR, 12.5.6BG).
Introducers do not advise
An estate agent or solicitor appointed as an IAR may introduce but may not arrange or advise on mortgages, or lead a customer to think it can (SUP 12.2.8G).
Suitability, not eligibility
Advice must be suitable, weighing term, payment stability and fees, and debt consolidation must consider the cost of a longer term and alternatives such as negotiating with creditors (MCOB 4.7A).
Advisers in ARs are your responsibility
Training and competence applies to AR staff, and advisers in ARs need CF30 approval, applied for by the principal (SUP 10A).
Protection is insurance distribution
An AR may not sell protection until it is on the Register, and advised sales must meet the customer's demands and needs (SUP 12.5.2G, ICOBS 5.3).

What the FCA has said recently

  1. 21 September 2026

    Pure protection market study final report

    The interim report found some intermediaries may switch customers after the commission clawback period to earn new commission, and asked the sector to collect better switching data.

  2. March 2026

    Mortgages regulatory priorities

    Principals should review onboarding, monitoring, oversight and wind-down plans holistically and on an ongoing basis, with advice fees set and monitored consistently.

  3. 12 March 2026

    FCA review of second charge advice

    Standards of debt consolidation advice could be improved. Broker fees were typically more than 10% of the loan, and record-keeping was incomplete.

  4. 30 January 2025

    FCA strategy letter to mortgage intermediaries

    Principals should monitor the type, volume and source of each AR's business, terminate dormant ARs, review conflicts such as common directorships, and watch conditional selling by estate agents.

Between annual reviews

An AR writes no business
Returns show each firm's case volumes, so a dormant AR trading on its Register entry is visible and can be offboarded.
Returns & tasks
Advisers join, leave or move
Each Individual is linked to their firms through Appointments, with their declarations and approvals, and Register changes are checked.
Fit & Proper
Annual reviews need assembling
Firm records, findings and evidence come together in the review, and the version the approver saw is kept.
Reviews & approvals

What to collect from each AR

Merrin schedules these as returns, by risk tier, and puts each one with the firm or Individual who needs to provide it.

Returns & tasks
  • Case volumes by type: first and second charge, lifetime, buy-to-let and protection
  • Broker fees as an amount and a share of the loan, procuration fees and protection commission
  • Protection replacement business, early lapses and clawbacks
  • Debt consolidation cases and the alternatives considered
  • Each adviser’s qualification, CPD and competence status
  • Other principals and the multiple principal agreements
  • Trading names, websites, introducers and links to estate agents
  • Complaints by product and cause, and revenue for REP025
  • Financial position and PII

Where Merrin fits

Merrin supports the principal’s oversight of firms and their people. It gives your team a record of outstanding work, findings and decisions outside the client case file.

Keep your existing systems

Mortgage sourcing, affordability assessments, applications and advice file checks stay with your existing systems and processes.

Mortgage-specific returns and integrations need to be agreed with your network before rollout.

See the roadmap

Consumer credit is our initial focus. Talk to us about the fit for a mortgage network.

Questions from mortgages & protection principals

  • Can an estate agent appointed as an IAR recommend a mortgage?
    No. An IAR's appointment is limited to introductions and non-real-time promotions (SUP 12.5.7R). It may not arrange regulated mortgage contracts or advise on home finance, and must not lead a customer to believe it can.
  • How many principals can a mortgage AR have?
    At most four in home finance: one each for regulated mortgages, lifetime mortgages, home reversion plans and home purchase plans, and only one where MCD credit intermediation is involved. For pure protection there is no limit. A written multiple principal agreement with each other principal is needed before appointment.
  • What does the FCA expect us to do about ARs that write little or no business?
    Monitor the type, volume and source of each AR's business and consider terminating an AR that is not carrying on regulated activity, so it cannot use the credibility of its Register entry for other work (FCA letter to mortgage intermediaries, January 2025).
  • Do our ARs’ mortgage advisers need FCA approval?
    Generally yes. The customer function (CF30) and governing functions apply to ARs, and the principal makes the application (SUP 10A). HM Treasury's February 2026 consultation proposes moving ARs into SM&CR, but that is a proposal, not law.
  • Is protection switching on the FCA’s radar?
    Yes. The pure protection market study found that some intermediaries may switch customers after the clawback period to earn repeat commission, and asked the industry to collect and report better switching data. The final report works through existing rules, so principals are expected to monitor it under the Consumer Duty.

Sources

Checked against these sources on . This is general information, not legal advice.

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