Regulatory Approval Options for Mortgage Firms – Network vs Direct Authorisation Explained | Choosing the right regulatory approval route is one of the most critical decisions a mortgage adviser or firm will make. Whether you join a mortgage network or apply for direct authorisation, your choice will shape your workload, compliance responsibilities and long-term growth. This guide explains your core mortgage adviser authorisation options in the UK and helps you understand the practical steps involved in each route.

It also includes real adviser case studies, step-by-step checklists and internal links to help you explore your options in more depth.

Mortgage Adviser Authorisation Options UK

Mortgage firms generally choose between two regulatory approval routes:

• Joining a mortgage network as an Appointed Representative

• Applying for Direct Authorisation with the FCA

Both options allow you to offer regulated mortgage advice, but the level of responsibility and support differs. Understanding these differences will help you choose the route that fits your goals, experience and appetite for compliance management.

To learn more about the pros and cons of both routes, you can explore the guide Should I Go AR or DA on the Connect Brokers website.

Joining a Mortgage Network vs Direct Authorisation

What Advisers Need to Consider

The comparison between joining a mortgage network and direct authorisation is not just about cost. It involves long-term operational decisions that affect compliance, systems, client management and growth potential.

Below is an expanded breakdown to help you understand how each route works in practice.

Option 1: Becoming an Appointed Representative (AR)

Joining a Mortgage Network

Joining a mortgage network allows your firm to offer regulated mortgage advice while operating under the network’s FCA permissions. For many advisers and small firms, this route offers faster start-up times, lower risk and reduced administrative pressure.

Key features of the AR route

• The network provides regulatory permissions

• Compliance, supervision and oversight are managed centrally

• The network provides systems, training and ongoing support

• You focus heavily on client advice rather than administration

• Costs are predictable through fees and commission splits

You can learn more about the network route by visiting the Connect Brokers Broker Network page.

Step-by-Step Checklist: How to Join a Mortgage Network

Step 1: Compare networks

Research networks that specialise in your type of advising, such as residential, buy-to-let or commercial. Review fees, commission splits, systems and culture.

Step 2: Submit your application

Provide business details, qualifications, identity checks and financial history. This includes referencing and a fit and proper assessment.

Step 3: Attend interviews and compliance checks

Networks assess whether you meet their standards for professionalism, business model and experience.

Step 4: Complete onboarding and supervision

New advisers typically go through an initial supervision period. A trusted network provides clear guidance and practical case support.

Step 5: Receive system access and start advising

Networks provide access to sourcing tools, a CRM, case submission routes and compliance portals.

You can explore these support systems in more detail on the Adviser Services page.

Case Study: Newly Qualified Adviser Choosing the AR Route

Sana recently gained her CeMAP qualification and wanted to start advising quickly without being overwhelmed by compliance. She applied to a specialist network that offered strong supervision, simple system integration and clear fees.

During her first six months:

• She received hands-on support through every case

• Compliance checks were completed quickly

• She built confidence working with high street and specialist lenders

• She grew her business without the stress of managing FCA obligations directly

By the end of her first year, Sana had doubled her expected income and built a robust client base. The network route allowed her to focus on advice while receiving the structure she needed as a new adviser.

Option 2: Applying for Direct Authorisation (DA)

Gaining Your Own FCA Permissions

Direct Authorisation gives you full control and full responsibility. This route suits established advisers who want independence, flexibility and direct relationships with providers.

Key features of the DA route

• You hold your own FCA permissions

• You manage all compliance, policies and procedures

• You handle file checking, record keeping and reporting

• You build your own lender relationships

• You have no commission splits or network fees

Although the DA route offers more control, it requires significant knowledge of regulatory requirements, monitoring and documentation.

Step-by-Step Checklist: How to Apply for Direct Authorisation

Step 1: Prepare your business model

You must clearly define your services, processes, client journey, data strategy and compliance approach.

Step 2: Build required documentation

This includes business plans, financial forecasts, risk assessments, policies, training records and compliance manuals.

Step 3: Submit your FCA application

The FCA reviews your fitness and propriety, experience, financial standing, operational readiness and systems.

Step 4: Respond to FCA queries

The FCA often requests clarification or additional evidence. Response timelines impact the speed at which your application progresses.

Step 5: Set up compliance systems

After approval, you must implement systems for monitoring, file reviews, complaints, adviser supervision and reporting.

For guidance on compliance responsibilities, you can explore the Mortgage Compliance information at Connect Brokers.

Case Study: Experienced Adviser Choosing the DA Route

Jordan had been advising for eight years and wanted full control over his client journey and business brand. He chose the DA route so he could build his own compliance structure and negotiate directly with lenders.

During his first year as a DA firm:

• He hired part-time compliance support

• He built his own CRM and redesigned his process to reduce admin

• He expanded into specialist lending without restrictions

• His profit margin increased because he kept all commissions

Although the DA route required more admin and setup time, Jordan valued the independence and direct relationships it offered.

 Joining a Mortgage Network vs Direct Authorisation

Which Route Should You Choose

Key Considerations When Choosing Your Regulatory Path

When deciding between joining a mortgage network or pursuing direct authorisation, it is essential to assess the size, goals and operational capacity of your firm. Smaller firms and newly qualified advisers often find that a mortgage network provides valuable structure during the early stages. Networks offer shared resources, cost efficiencies and access to systems that can be expensive to manage independently. They also support advisers through supervision, compliance oversight and collective bargaining power, which can improve commission outcomes.

Established firms with internal processes and compliance expertise may feel more comfortable applying for direct authorisation. This route offers greater flexibility, direct relationships with lenders and full control over the client journey. Firms that want to build a unique brand, expand into specialist lending or tailor their compliance framework often prefer the independence that direct authorisation provides.

Both routes have strengths and challenges. The most important step is to evaluate how each option aligns with your business model, long-term plans and appetite for regulatory responsibility. Consider the impact on operational workload, client servicing and future growth.

Whichever route you choose, the decision should strengthen your ability to deliver high-quality advice and support sustainable business development. Take time to research the regulatory requirements, speak with advisers who have taken each path and seek guidance from compliance specialists to fully understand the implications before making your choice. As seen and written by Liz Syms in The Society of Mortgage Professionals

What to do next?

Contact our team today to discuss the best regulatory approval option for your mortgage firm.  Speak with an expert, explore lender panel access, and understand the compliance support available before committing. Book a free call with our team today and discover how Connect can support your growth, strengthen your client offering and give you the confidence to succeed.