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Mortgage fees cost consumers £8.7bn
17/04/2008 09:44:00
Consumers are paying out an additional £8.7 billion per year in mortgage fees, according to new research.
Findings from financial experts uSwitch.com shows that consumers pay an average of £987 to set up a mortgage.
Add this to the mortgage payment and they could more than double the original monthly fee shows the study.
Ann Robinson, director of consumer policy at uSwitch.com, said that this is "a real catch-22" for consumers who are struggling to find the funds to pay their mortgage set-up costs.
"Adding fees to a mortgage means that you will be spreading the amount over many years and paying interest for the pleasure of doing so - this is an extremely expensive option and should always be seen as a last resort," she warned.
The research shows that if consumers choose a mortgage with the maximum fee of £4,094, then over a 25-year term this fee will inflate to £8,682 - adding almost £30 to the monthly mortgage payment.
Previously, uSwitch research showed that consumers pay £30 more on buying insurance from the car manufacturer instead of going direct to the underwriter.
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