Last week was dominated by a report from Moneyfacts that found that Mortgage Fees have risen to their highest level for 25 years, on average standing at £1,522.
In my opinion, lenders have been steadily increasing fees over the past few years in order to counter a reduction in the headline rate, make more profit and remain top of Best Buy Tables.
As a result a growing number of so called Best Buys can be deceiving and can actually end up costing a borrower more over the initial period of the loan, once the fees are taken into account, than a product with a slightly higher rate.
This renders many such tables as pretty meaningless other than being a very rough guide.
Any decent, genuinely independent broker will be able to do a quick calculation to see whether a borrower is better off with a lower rate and a high fee, or with a slightly higher rate but with a lower fee or no fee product.
Taken together with the huge variances in service I have spoken about previously and the question of flexibility, whilst a borrower may think that they have found the “best” product for them, usually this is based on nothing more than it seems to be the cheapest headline rate.
As everyone knows, cheapest does not mean the best or most suited, so a 10 minute chat with an independent broker could well save not only a pretty penny for the borrower, but ultimately the whole transaction.