Taking on a mortgage is a serious decision; it’s probably the largest financial decision you can ever make, because it involves a large sum of money, allows you to buy an expensive piece of property, and will continue for many years (a large part of your life). Hence, you want to do it right, and you want to be informed of all the ins and outs of the whole process.
However, getting a mortgage is not always that easy – and there may be more expenses than you originally expected. Aside from the mortgage itself, there are some other costs you have to incorporate into your calculations. Here’s your all-important guide to different mortgage costs and fees: what to expect.
Fees and charges
Fees and charges will depend on many things, and you have to look at your own personal situation in order to understand it all. Here are just some of the various fees and charges that could be charged:
- Arrangement fee. Also known as a completion fee, this is paid as compensation for the actual mortgage product – it can be added to your mortgage fee, but this will increase the actual mortgage.
- Valuation fee. Your property needs to be evaluated, and the valuation fee is a necessary part of that process.
- Booking fee. The simple act of applying for a mortgage may bring along a booking fee; some lenders will include this in the arrangement fee.
- Mortgage account fee. This fee is charged for setting up the account and is to compensate for all the administrative work done regarding your mortgage.
- Missed payments. Depending on which lender you make a deal with, missed payments may be charged with a fee.
- Mortgage broker fee. This is for the broker. It’s worth it if you have received valuable advice.
- Insurance arrangements. You may be able to avoid these, depending on the lender.
- Early repayments. This fee may not always apply, also depending on the lender.
Some other charges
You may have to incur some other expenses – and they should be considered in advance as well. Here are just some examples:
- Moving costs
- Stamp duty on residential areas
- Refurbishing costs
- Expenses for extra furniture or new items
- Legal and survey fees
It’s very important that you get the right mortgage deal for your financial circumstances – there is plenty of professional advice to be found, such as advice from a professional mortgage advisor Bristol offers, in case you feel your knowledge of mortgages is inadequate, or if you feel you need help deciding which is best for you. Some mortgage deals may sound attractive, but the fine print may end up frustrating you later on. It’s an important decision, so make sure you are informed as much as possible.
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