Mortgage fees rise again

Posted on June 17th, 2011 | Categories - Mortgages

Borrowers already struggling with tighter lending criteria are having to cope with increased mortgage application fees which have risen by 13% over the past two years.

Research done by moneysupermarket.com has shown that application fees for Tracker and Fixed Rate mortgages have risen by 13% since September 2009.

It would seem that as interest rates have fallen, lenders have increased the arrangements fees they charge for mortgages so that their profit margins are protected. This has lead to a situation where the mortgage product with the best headline interest rate may not actually be the best deal once fees are factored in.

The mortgage products with the best headline interest rates tend to carry to highest arrangement fees and experts have highlighted the importance of looking at the whole deal and not just being attracted by a low rate of interest.

The research comes at the same time as data from the Council of Mortgage Lenders shows that the amount of loans made to purchase homes had fallen in April to 40,900 from 41,900 at the same time last year.