SSAS Arrangement Fees: What You Will Pay and Why

SSAS Arrangement Fees: A Complete Breakdown

When your SSAS borrows to fund a commercial property purchase, the headline interest rate is only part of the cost picture. Arrangement fees — charged by the lender to set up the facility — can add £3,000 to £15,000 or more to the cost of a typical SSAS mortgage transaction. Understanding what these fees cover, how they are structured, and how they compare across lenders is essential for making informed financing decisions.

What Is an Arrangement Fee?

An arrangement fee (sometimes called a facility fee or product fee) is a charge levied by the lender to cover the costs of underwriting, processing, and arranging the mortgage. It represents the lender's internal costs of assessing the risk, preparing documentation, and executing the facility — and in many cases, it also represents a margin contribution that supplements the interest income on the loan.

Arrangement fees are almost universal in commercial property finance — they are not a sign of a poor product, they are a standard feature of the market. What varies is the amount, how it is calculated, and whether it can be added to the loan or must be paid upfront.

How Arrangement Fees Are Calculated

SSAS mortgage arrangement fees are most commonly expressed as a percentage of the loan amount:

• Standard range: 1% to 2% of the loan amount
• Minimum fee: Many lenders apply a minimum fee (often £1,500-£2,500) for smaller loans where the percentage-based fee would be very low
• Fixed fee products: Some lenders offer fixed arrangement fees rather than percentage-based fees — more predictable but potentially more expensive for larger loans

For a £250,000 SSAS mortgage at 1.5%, the arrangement fee would be £3,750. For a £500,000 loan at the same rate, the fee would be £7,500. On larger SSAS property transactions, arrangement fees can run to £15,000 or more.

When Is the Arrangement Fee Paid?

Lenders have different payment requirements for arrangement fees. The three most common structures are:

Paid on Completion

The full arrangement fee is paid at the time the mortgage completes. This is the most common structure. The fee is paid from the SSAS funds (or can be deducted from the advance) and forms part of the transaction costs.

Added to the Loan

Some lenders allow the arrangement fee to be added to the outstanding loan balance, so the SSAS does not need to fund it from existing cash. This is convenient but increases the total loan amount and therefore the interest cost — in effect, you pay interest on the fee for the life of the mortgage.

Split: Part on Application, Part on Completion

Some lenders charge a booking or commitment fee at the time of application (typically £500-£1,500), with the balance paid on completion. The application fee is usually non-refundable if the transaction does not proceed — it compensates the lender for the cost of processing the application.

"Arrangement fees can sometimes be negotiated, particularly on larger transactions. Lenders want the deal — if you can demonstrate that you have alternatives and are not in a rush, there is sometimes room to move on fees even where the headline rate is firm." — Matt Lenzie, Former Banker & Corporate Finance Partner

Lender Legal Fees

Separate from the arrangement fee, lenders typically require the borrower (the SSAS) to pay the lender's legal costs in addition to their own. Lender legal fees for SSAS commercial mortgages typically range from £800 to £2,500 depending on complexity. This is in addition to the SSAS's own solicitors' fees.

Always budget for lender legal fees alongside the arrangement fee when calculating the total cost of the transaction.

Broker Fees

If you are using a specialist SSAS finance broker to arrange the mortgage (which is advisable given the specialist nature of the market), the broker will charge a fee for their services. This is typically:

• A percentage of the loan amount (0.5-1.0% for most transactions)
• A fixed fee agreed upfront
• A combination of an upfront engagement fee and a completion fee

While broker fees add to the total cost, a good broker can often more than offset their fee through better rates and terms than you could achieve directly. Access to the full SSAS lender panel and specialist negotiating knowledge typically delivers meaningful savings relative to approaching lenders without support.

How to Evaluate Arrangement Fees in Context

The right way to evaluate an arrangement fee is as part of the total cost of borrowing over your planned holding period. A high arrangement fee on a product with a very low rate may still be cheaper in total than a lower arrangement fee on a higher-rate product. Use our SSAS mortgage calculator to model the total cost including fees for different product options.

As a guide, on a three-year hold period, an additional 0.5% arrangement fee (£1,250 on a £250,000 loan) is equivalent to adding approximately 0.17% to the annual interest rate. This helps contextualise whether a lower-fee product with a marginally higher rate is actually better value.

Negotiating Arrangement Fees

Arrangement fees are sometimes negotiable, particularly for:

• Larger transactions where the percentage fee seems disproportionate to the work involved
• Repeat borrowers or clients with existing relationships with the lender
• Transactions where multiple lenders are competing for the business

A specialist broker is best placed to negotiate on fees, as they have both market knowledge and established relationships with lenders.

Key Takeaways

• Arrangement fees typically range from 1-2% of the loan amount for SSAS mortgages
• Fees may be paid on completion, added to the loan, or split between application and completion
• Lender legal fees are separate from arrangement fees — budget for both
• Always model fees as part of total cost over your planned holding period
• Fees are sometimes negotiable, particularly on larger transactions or through a specialist broker

Get a Full Cost Breakdown Before You Commit

Our team provides a comprehensive cost analysis — including all fees — for every SSAS mortgage transaction, so there are no surprises at completion.

Contact us today for a full cost comparison, or read our related guide on SSAS exit fees.