Fees & Penalties

At mortgagesplease, we do not pretend that our services are free, but we ensure that all our fees are transparent and fully explained up front so that you can make an informed choice and know what you are going to receive for your money should you choose to use our services as a broker.

Redeeming your mortgage undoes the arrangement that cost the lender time and money to set up, so most are not happy to see it unravelled. The main types of penalty invoked are:

-          If you take out a mortgage with a period offering a special rate, such as a fixed rate for two years, and decide to extricate yourself from the mortgage within that time, you will have a penalty to pay. After all, such deals are made deliberately attractive to keep you in the contract.

-          Deals in which you are penalised even if you leave after the mortgage rate has reverted to the lender’s Standard Variable Rate. We would not normally advise accepting such an arrangement.

-          A general discharge fee for paying off the loan at any time during the mortgage.

-          Stepped interest rates: the rate rises up each year – a particularly onerous loan as it can come on top of a variable rate, with rates rising generally each year. Admittedly, the initial rates might be very attractive, but not to be entered into lightly.

The past nine months have seen fees increasing significantly in all aspects of mortgage applications. They are usually linked to a low interest rate, enabling lenders to gain publicity from an attractive “headline rate” (like the “from £X” tickets from airlines). Headline rates are not often the best value – rest assured, mortgagesplease can see the wood for the trees.

Those low cost deals: When calculating the lowest cost deal, we take into account:

-          The rate at which a mortgage reduces.

-          The method of calculating interest (daily or annual), fees to arrange the mortgage

-          Fees to leave the lender (redemption so as to remortage)

The deals we eventually recommend at mortgagesplease are either going to be similar to what you may be offered by a lender directly, but sometimes we have exclusives which are better.