Homeowners are missing out on falling loan rates because lenders have raised their fees, research revealed yesterday.
Charges for securing the best deals have been bumped up to as much as £3,000. Banks and building societies have made a flurry of rate cuts in recent weeks after inflation slowed to 6.7 per cent in August and the Bank of England ended its streak of rate hikes.
But a range of two-year fixed rate products available in July – when mortgage rates were close to their peak – were cheaper than those on the market today.
Some mortgage holders will now pay up to £960 more than if they had locked in at a higher rate.
This is because lenders have offset the cost of falling interest rates by increasing the amount they charge in arrangement or product fees. These are upfront charges that borrowers must pay to secure the fixed rate. They are typically between £999 and £1,499, but a handful are now higher.
Homeowners are missing out on falling loan rates because lenders have raised their fees, research revealed yesterday
Skipton Building Society is the worst offender, charging £2,995 on its five-year deals for those with 10 per cent, 15 per cent and 25 per cent deposits. Santander charges £2,499 on 24 of its two-year fixes for those with a 40 per cent, 30 per cent and 25 per cent deposit.
Nicholas Mendes, of mortgage broker John Charcol, said: ‘It is slightly ironic from Skipton Building Society, a lender that champions itself on supporting first-time buyers and creating a level playing field with innovative products, is one of the worst culprits in increasing its arrangement fees to offset a lower interest rate.’
Source: | This article originally belongs to Dailymail.co.uk
Content source – www.soundhealthandlastingwealth.com
