Arrangement fees ..... extortionate....

marshallka

I am looking to change the deal I am on currently with the same lender and also for the same amount of mortgage as my special deal comes to an end next month. I have to pay £1499 to do this and cannot believe how much these fees have risen in the last couple of years.

How can they justify this really?? Talk about kicking you when you are down. We cannot look to look around elsewhere as we are now paying interest only as we found the payments too much for now and also they were a provider that gave us the most loan to wage ratio.

I think that this will be the next big reclaiming matter in which the FSA will get involved with. Its extortionate I think.


Alistair Darling, the Chancellor of the Exchequer, has issued a stark warning to banks and lenders – to reduce extortionate arrangement fees on mortgage loans and stop ripping consumers off. This comes after a recent report that lenders have been hiking up arrangement fees on mortgages, and that some have even doubled over the past year or two, with others being hiked up more recently.

This was the 7th August, 2008. When will something be done? I don't want to pay this and then them do something about it and lose out or have to go through a claim with the FOS to get them back.

dimbo61

You could save the £1499 and simply go onto there SVR !
Or check your terms and conditions which came with the mortgage and check if the mortgage reverts to another deal ( like mine BOE base rate plus 0.75% ) which might be the best deal for you at the present time.
You need to either start overpaying on the OI mortgage or change onto a repayment if you ever want to clear your debt. GOOD LUCK

dunstonh

How can they justify this really??

Very easily.

Talk about kicking you when you are down

Why? No-one is forcing you to buy that particular deal.

I think that this will be the next big reclaiming matter in which the FSA will get involved with. Its extortionate I think.

FSA dont have a problem with them as they are retail products with a fully disclosed price tag and the interest is typically lower making them very attractive for larger mortgages.

Next you will be saying that all cars should cost the same.

This was the 7th August, 2008. When will something be done?

There wont be.

You need to understand that typically the larger fee mortgages are just moving the profit margin from the rate to the fee. That makes them expensive for small mortgages but very good value for larger mortgages. You have a choice and I dont see why the larger fee mortgages should be removed to suit you when it will be all those with larger mortgages that would lose out.

baby_boomer

marshallka wrote: »

Alistair Darling, the Chancellor of the Exchequer, has issued a stark warning to banks and lenders – to reduce extortionate arrangement fees on mortgage loans and stop ripping consumers off.

He's also told the same banks to increase their capital in order to be more secure.

How will they do that, I wonder, if they can't make a profit?

Having the government as a major shareholder in several banks will provide endless amusement for those seeking examples of hypocrisy.

marshallka

dimbo61 wrote: »

You could save the £1499 and simply go onto there SVR !
Or check your terms and conditions which came with the mortgage and check if the mortgage reverts to another deal ( like mine BOE base rate plus 0.75% ) which might be the best deal for you at the present time.
You need to either start overpaying on the OI mortgage or change onto a repayment if you ever want to clear your debt. GOOD LUCK

Thats what i thought. Just leave it at the SVR for now and hope that it becomes cheaper in time or that rates come down. When i look at what we would be saving over 12 months for putting another £1499 on the mortgage then I think it probably the best option.

Thanks for the input and I agree with you about the "never paying it off" but we may be able to revert again soon. Only done it for 12 months as things got tough. It was either that or rent and I feel we have done the right thing. We have no other debts and at least can afford this way and the kids don't have to be uprooted. You never know what is around the corner and things cannot get any worse hopefully.:o

feisty1

marshallka vbmenu_register("postmenu_14934277", true); I agree with u 100% I was solely a Financial Adviser until 5yrs ago when I changed over to mortgages...Arrangement Fees then were around 50-250, over the 5yrs how they have escalated is appalling. In my opinion they hope for rate chasers, clients who dont use advisers & chase rates on their own. Low rate high fee........either way u can't win, just like the betting shop. Who is yr current lender & is yr mortgage in excess of 90%

marshallka

dunstonh wrote: »

Very easily.



Why? No-one is forcing you to buy that particular deal.


FSA dont have a problem with them as they are retail products with a fully disclosed price tag and the interest is typically lower making them very attractive for larger mortgages.

Next you will be saying that all cars should cost the same.



There wont be.

You need to understand that typically the larger fee mortgages are just moving the profit margin from the rate to the fee. That makes them expensive for small mortgages but very good value for larger mortgages. You have a choice and I dont see why the larger fee mortgages should be removed to suit you when it will be all those with larger mortgages that would lose out.

I still think its wrong and is extortionate to want that amount (sometimes up to £5K) just for switching deals with the same lender. I understand that you think not so we can beg to differ here.

marshallka

feisty1 wrote: »

marshallka vbmenu_register("postmenu_14934277", true); I agree with u 100% I was solely a Financial Adviser until 5yrs ago when I changed over to mortgages...Arrangement Fees then were around 50-250, over the 5yrs how they have escalated is appalling. In my opinion they hope for rate chasers, clients who dont use advisers & chase rates on their own. Low rate high fee........either way u can't win, just like the betting shop. Who is yr current lender & is yr mortgage in excess of 90%

My current lender is Intelligent Finance and its about 75% LTV.

grogdog

i think this is a prime example of why we are in the problem we ar today, people getting interest only mortgages as they couldnt afford repayment and now they are all f****d. it will not be until people like this and greedy btl people lose their properties that we will be abl to move on.

harsh but true , this person shouldnt have a mortgage they cant afford the premium and brokers have a lot to answer also to.

and it seems tha tit is vryone elses fault but their own

marshallka

grogdog wrote: »

i think this is a prime example of why we are in the problem we ar today, people getting interest only mortgages as they couldnt afford repayment and now they are all f****d. it will not be until people like this and greedy btl people lose their properties that we will be abl to move on.

harsh but true , this person shouldnt have a mortgage they cant afford the premium and brokers have a lot to answer also to.

and it seems tha tit is vryone elses fault but their own

We have lived here for 13 years and have always paid our mortgage off capital and all and its ONLY been 12 months on interest only. You ignorant person. I never said i got an "INTEREST" only mortgage.

I think you need to apolgise here..

How dare you post like that... I HAVE always paid my way in life. I have never been greedy.

minimike2

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