Homebuyers crippled by soaring mortgage fees
With mortgage rates at a record low, homebuyers up and down the country have been given a chance of getting their foot on the first rung of the property ladder. But according to industry experts, soaring mortgage fees imposed by lenders is crippling their attempts.
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Financial information firm Moneyfacts reports that the banking giants have increased mortgage fees to their highest level since records began 25 years ago, with the average cost of arranging a mortgage now at more than £1,500.
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Moneyfacts revealed that fees have risen by £112 over the last four months, an increase that the firm suggests is "hard to justify".
In fact, just five short yeas ago, the average arrangement fee was £874 - that makes today's costs nearly 75 per cent higher.
While the Government-backed Funding for Lending scheme has encouraged banks to increase their lending and interest rates on many mortgages at a record low, the sharp recent hike in fees means the benefits in many cases have been largely cancelled out, and some big-name lenders are now charging fees of more than £2,000 on their better mortgage deals.
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Silvia Waycot of Moneyfacts warned homebuyers not to "get caught up in the excitement" of tempting low mortgage rates without first looking into the potential impact of such charges.
She told the Daily Mail: "High upfront charges such as fees can easily be overlooked. But their impact across the life of the mortgage can turn a cheap deal into a costly one."
Are you trying to get onto the property ladder? Have soaring mortgage fees left you unable to buy your first home? Leave your comments below...
