Borrowers could be paying over the odds when applying for a mortgage, thanks to rising fees and a confusing array of charges, according to Which?
The consumer group found that when tested, only 3 per cent of homeowners could rank five two-year fixed-rate mortgage deals in price order when shown typical product information, including APR.
This rose to 36% when they were also presented with the total cost of mortgages over 24 months.
With over 40 different fees and charges from lenders, from set-up costs through to arrears fees and final repayment charges, Which? argues that lenders do not make it clear what each fee means nor whether they are avoidable or not. Arrangement fees have also become more expensive, doubling in the past five years, from an average of £878 in 2009 to £1,588 in 2014.
Which? executive director Richard Lloyd comments: “Homeowners could be paying over the odds for their mortgage because of the complex range of fees and charges that prevent them from finding the best deal.”
Source: The Movechannel