Recent research has revealed that an increasing number of mortgage lenders are now charging a percentage fee on their fixed rate mortgage products.
There has been an increase of 6 percent in the number of lenders charging these fees, which has risen from 43 percent to 49 percent.
The fees for those with larger mortgages can run into thousands of pounds according to officials, and there are concerns that only 4 percent of products that charge these fees actually have a ceiling limit with regards to the maximum fee that will be charged.
The amount charged by way of the mortgage fee can vary from lender to lender, and whilst some charge only a small fee of around 0.4 percent of the mortgage loan other lenders are charging as much as 2.5 percent, which can result in a hefty fee on a larger mortgage with no cap on the maximum fee charged.
The average percentage fee charged is said to be around 0.89 percent, which would mean a fee of £1335 on a mortgage for £150,000.
One official involved in the research stated: “Fees are often linked to loan to value ratios and anyone without a significant amount of equity in their house can expect to pay a hefty fee. Borrowers looking for a mortgage focus on rate, but fee has to be a consideration particularly when these can run into thousands of pounds. All too often we forget about the fee by rolling it straight into the loan.”
He also said that consumers needed to work out what would benefit them most in terms of the fees, adding: “Borrowers need to make a calculation as to whether they opt for a fixed or percentage fee but with the introduction of large numbers of low fee mortgages this year borrowers do have options when it comes to choosing a mortgage.”
Tags:
mortgages,
mortgage percentage fees,
mortgage fees
Related Posts
Equity release schemes can often prove to be very useful for older homeowners that want to unlock some of the equity in their homes, but the scheme have also come under fire on a regular basis as a result of the fees that many elderly end up paying. »
Tags: mortgage percentage fees, mortgages, mortgage fees
Earlier this month the High Street banking giant HSBC brought back one of its popular mortgage products, the Rate Matcher mortgage, which promised to match or beat a homeowner’s current rate and fix it for two, three, or five years. »
Tags: mortgage percentage fees, mortgages, mortgage fees
Industry officials are warning that consumers need to make sure that they are vigilant about the fees and additional charges that are being applied to many mortgage products, as these can be very expensive and can really bump up the cost of the mortgage loan. Officials have stated that many people that are looking for mortgage loans or a remortgage are simply looking at the headline rate without looking at what sorts of other costs are involved.»
Tags: mortgages, mortgage fees, mortgage percentage fees
Whilst much of the news relating to mortgage and housing affordability in the UK has been bleak for quite some time, there has been a little good news for consumers recently. »
Tags: mortgage percentage fees, mortgage fees, mortgages
The hefty fees that many mortgage lenders have charged have been under fire for some years, but is seems that the fees that were being charged a couple of years ago are nothing compared to the ones that are now being charged. A recent report has shown that mortgage arrangement fees have soared over the past couple of years, and at a time when finances are tighter than ever and credit conditions have become incredibly difficult, consumers are being charged through the nose by lenders through extortionate arrangement fees.»
Tags: mortgage percentage fees, mortgage fees, mortgages
Leave a comment