Mortgage Article

Mortgage lenders use headline interest rates to attract ( home insurance quotes ) borrowers. But behind the scenes theyre introducing a whole raft of add on charges. This article explains.

Mortgages. Watch out for add-on charges.

Every year more and more homeowners are re-mortgaging their homes

to benefit from mouth wateringly low interest rates. But beware, the lenders are hiking up their other add-on charges to bolster their profits.

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Mortgages. Watch out for add-on charges.: Mortgage lenders use headline interest rates to attract borrowers. But behind the scenes they're introducing a whole raft of add on charges. This article explains.

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Behind those irresistible headline offers - for example, 4.3% for a two year fixed deal - some of the big mortgage lenders have been busy with the small ( car insurance quotes ) print! Many have introduced a whole range of add-on charges and if you dont watch out, these can wipe out your savings.

The soaring charges are the lenders response to the borrowers increasing tendency to switch mortgages to take advantage of successive special offers. The industry are schizophrenic about switchers, on the one hand calling them "rate tarts" and then welcoming their business on the other! And re-mortgaging has certainly become big business. Last year, more than 1.1 million homeowners re-mortgaged for a total of £117 billion.

In fact, some lenders are now charging around £1,000 to switch to ( best mortgages ) another mortgage product - even when its supplied by themselves! (life insurance)

The sort of charges were referring to are early redemption fees, valuation fees, exit fees, even telephone calls and photocopying! One well-known lender has even issued a ( insurance ) list of 23 charges ranging from £35 for a telephone call to £26 for a letter and £20 for a replacement mortgage statement.

But the biggest concerns centre on exist fees. These are the fees which are charged when you decide to re-mortgage. Some lenders like the Royal Bank of Scotland ( secured loans ) and the National Westminster Bank, have increased them by 125% - from £100 to £225. Here are a few more examples:-

Mortgage Lender	Exit Fees
Fee in 2004	Fee in 2006
Abbey	£179	£225 (medical insurance)
Alliance and Leicester	£195	£250
Barclays/Woolwich	£195	£275
Bristol & West	£175 (life insurance)	£195
Halifax	£100	£175
Lloyds/TSB/Cheltenham & Gloucester	£180	£225
Nationwide	£0 (cheap car insurance)	£90
Northern Rock	£195	£250

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Statutory Wealth Warning:
Your home may be repossessed if you do not keep up your repayments on a mortgage or any debt secured on it.