Mortgage Broker Fee's

roblaity77

Hi

I've been trying to get a mortgage and decided to go through a broker to meet our circumstances.

What fee's should I expect to pay?

I have spoken to one company who have taken all our details and have stated they can get us a mortgage at a good rate.

However they have just sent me a list of fee's that I think are a bit much. As follows:

Booking Fee - £95
Arrangement Fee - £499 (to be added to the loan)
Valuation fee - £225
Broker Fee - £1495 (earned under offer, paid on completion)

Can someone shed some light on this for me please? As a first time buyer I don't know what i'm looking at. I know that I wont be paying that much if I can avoid it!

Thanks

benjus

The booking fee, arrangement fee and valuation fee are standard parts of applying for a mortgage, and they vary between providers. The figures above look quite low - I assume they are for a specific mortgage?

The broker fee - if it's paid by you it's very high (we paid £400 IIRC to our broker last year) but if it's commission paid to the broker by the mortgage firm you don't need to worry about this. The only question is whether the broker is finding the best deal for you, or the one that gets them the most commission.

fairy_lights

That does sound high for a brokers fee - I'm a first time buyer and my broker only charges £295.
I don't know how they can tell you what the arrangement and valuation fee's will be because that's something that will depend on your mortgage provider. I would shop around and get some other quotes if I were you.

Paully232000

for comparison, the fee to our broker was £299

kingstreet

Are we talking high street lender/rate here, or adverse credit or some other reason for being with a specialist broker/lender?

The two aren't comparable in terms of the work required.

kingstreet

We only charge £250, but we don't get involved in messy adverse credit cases and similar...

Richard_Webster

We only charge £250, but we don't get involved in messy adverse credit cases and similar...

Good on you, Kingstreet! I think this is about the standard that most good brokers charge.

payless

The level of fees can be confusing -

Fee charging is not the same as fee based

for example

Is the fee in addition to commission.

Is the broker only offering information on deals that earn commission ( some don't)

You can still get brokers who do not charge fees

You can also get brokers that charge fees and then refund any commission ( which may actually be more than the fee). This last option is the true meaning of fee based. ( ie no possible sway to commission)

kingstreet

Richard_Webster wrote: »

Good on you, Kingstreet! I think this is about the standard that most good brokers charge.

I was asked to justify it the other day.

Believe it or not, it was on a shared ownership case for £35,000 with a commission payment of £132 from Leeds BS.

Here in the Midlands it's not all £200k+ mortgages and £600+ fees from lenders! The fee is the difference between making a profit or not on some cases.

ACG

£1500 is high for a broker fee.

I tend to charge around £1000 where there is adverse (can be more or less depending on commission), so £1500 must mean its a real nightmare of a case or they are just expensive.

If its a straight forward application I would expect the fee to be a LOT less than that.

Loopy28

My broker fee is £350. They are receiving about £700 from the mortgage company in commission on top.

The valuation/application and product fees are charged by the mortgage company and not the broker.