How fees can impact on mortgage costs
May 20, 2016 by Brendan
Borrowers
Selecting a mortgage deal can be a complex process, as each product will have different interest rates and mortgage fees. Choosing the product with the lowest rate of interest may seem like the common sense choice, but may cost you thousands of pounds more due to the addition of expensive mortgage fees.
According to research conducted by Moneyfacts. co.uk, the cost of mortgage fees has increased during the last six months, from £927 to £967. The cost of mortgage fees for fixed rate products has also increased and is now at a new high of £975. According to the finance expert at Moneyfacts, Rachel Springall, the fees are becoming higher for the lowest rate deals which are being offered. For instance, the fees for an average two year fixed rate deal are lower than those for the lowest two year fixed rate deals.
However, there are some deals which are available with no fees to pay at all, while others have low mortgage fees. According to Springall, it is advisable to calculate the costs of a mortgage deal over the long term, including the cost of fees and the cost of the mortgage over the entire term. A slightly higher interest rate may work out cheaper than a lower rate with higher mortgage fees.
Mortgage advisers invest in courses with a CeMAP training company so that they have the required knowledge to calculate the most beneficial deal for clients. It is advisable to seek professional advice before choosing a mortgage product.
Written by
Brendan
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