29 Nov

Homeowners 'fail to account for mortgage fees'

Homeowners 'fail to account for mortgage fees'

Homeowners are failing to place sufficient emphasis on fees when choosing a mortgage product, it has been claimed.

A study from moneysupermarket.com found that 74 per cent of those surveyed placed major importance on the interest rates offered by the deal.

However, just 32 per cent of respondents were found to study the associated fees of the products.

Louise Cuming, head of mortgages at moneysupermarket.com, said that by fixating solely on rates borrowers are failing to accurately calculate the true cost of the products.

She said: "It’s of grave concern that homeowners are placing most importance on low interest rates. With fees having shot up over the past 12 months, people need to factor in the true cost of a mortgage rather than be tempted by the rate.

"For example, someone with a Yorkshire Building Society mortgage at 4.99 per cent would pay £1,200 more over two years than someone with Britannia at 5.94 per cent. It's almost natural instinct for borrowers to believe a lower interest rate is better, but that isn't always the case."

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