Not renewed your self-employed mortgage in a while? You may be in for a shock—and not a pleasant one—when the time comes. Lenders’ mortgage arrangement fees have risen, but don’t take them at face value…
In 2009, the average lender arrangement/product fee was less than £1,200. In 2013, that risen to £1,500+, a rise of more than 25%. Come 2020, many fees hover around the £1,000 mark. So they’ve dropped, then? Is that right?
Yes. And no. Mortgage Arrangement, or Product fees are not all as clear-cut as a one-off payment. Variables determine the final fee that you need to know about.
Deposit and interest rate can fluctuate to make the ‘arrangement fee’ look attractive. MoneySaving Expert sums it up succinctly:
Beware low rates disguising high fees.
Cunning lenders often use high fees to make their interest rates look more attractive, so they rise up the best buy tables. Some charge fees of £2,000+. Expect to pay a fee of at least £1,000 to secure an attractive rate.
Why have arrangement fees risen so much so quickly?
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