29-11-2007
Unrestricted mortgage application fees on increase
News by Adfero for Simply Business - independent providers of business insurance, business finance, landlord insurance, buy-to-let mortgages & commercial mortgages.
The prevalence of mortgages with unconstrained application fees has increased significantly over the last 12 months, a new survey has revealed.
Research released by comparison website MoneyExpert.com has found that over the last 12 months, the number of mortgages packaged with an unrestricted application fee has increased to 506, compared with 110 in November 2006.
A mortgage application fee is usually calculated as between one and two per cent of the total amount being borrowed - although such a fee can be as high as 3.25 per cent, MoneyExpert.com asserts.
"The rate at which banks and building societies are increasing the cost of their fees or switching to uncapped fees is alarming," said Sean Gardner, chief executive of MoneyExpert.com.
"What might look like a good deal will soon become a bad deal once fees are taken into account," he added.
In related mortgage news, research by analysts Mintel has highlighted that up to 5.5 million UK mortgage holders could be seriously affected by the sub-prime mortgage crisis currently affecting the US.