Mortgage fees on the rise
2013 has seen the average mortgage arrangement fee rise significantly – in fact it’s now at the highest figure ever seen in the UK.
According to Moneyfacts.co.uk the average mortgage fee now stands at just over £1500.
Mortgage lenders have been driving down interest rates to record lows over the past few months, however the arrangement fees have been on a steady rise.
A typical fixed-rate mortgage with a 90% LTV (over 5 years) sees the average fee at around £1400 compared to just £900 back in January.
Moneyfacts Editor, Sylvia Waycot warned that although consumers are being told of the competitive interest-rates available for mortgages, they also need to be aware of the fees involved.
Ms Waycot commented:
“It’s easy to get caught up in the excitement of heavily marketed mortgages that shout about low interest rates, but beware that they will often be at the expense of high fees.
The average fees charged have risen by almost 8% since January, though it is hard to justify how setting up costs can possibly have risen by this much.
Mortgage lenders that are enjoying cheap funding for lending, courtesy of the Government, must be seen to be opening up the market to new borrowers and reducing rates will help with this message.”