Completion Fee?

EhJack

Hi everyone,

I've got my mortgage offer and in the fees section it says £999 for the completion fee (deducted from the loan on completion and not refundable).

My brain is all over the place at the moment so I'm probably overthinking but what does this mean? Is it paid upfront or added on to the loan?

Thanks

dunstonh

My brain is all over the place at the moment so I'm probably overthinking but what does this mean? Is it paid upfront or added on to the loan?

most fees give you the choice of upfront or added to the loan. Yours is added to the loan. However, you can still pay it off straight away if you want to save the interest that will be charged on it.

EhJack

dunstonh wrote: »

most fees give you the choice of upfront or added to the loan. Yours is added to the loan. However, you can still pay it off straight away if you want to save the interest that will be charged on it.

Thanks for confirming that. I was thinking of overpaying £1-2k when I move in to cover this and some of the interest gained during completion. Does this sound the right thing to do?

kingstreet

The way you have written it suggests the fee is deducted from the amount you have asked to borrow and not added to it.

This means you are paying the fee yourself as you will have to pay the extra £1k to your solicitor ahead of completion.

EhJack

Hmm that's what I was thinking to begin with... Now I'm not sure again! I wish documents would be worded better so people could actually understand them

Thrugelmir

EhJack wrote: »

Hmm that's what I was thinking to begin with... Now I'm not sure again! I wish documents would be worded better so people could actually understand them

Are you borrowing the money or not. You should know.

dunstonh

I think you need to ask them.

Same words but could be read either way. Personally, i am leaning towards it being deducted from the loan account and increasing the amount being borrowed as that is what normally happens. However, the other way fits that wording as well.

EhJack

Thrugelmir wrote: »

Are you borrowing the money or not. You should know.

I have a loan amount of the property minus my deposit. I have the money to pay for the fee, I would just like to know whether this is taken before completion or whether it gets added on to my loan.

kingstreet

Which lender are we talking about?

EhJack

kingstreet wrote: »

Which lender are we talking about?

It's Aldermore

kingstreet

Wording;-

"Completion fee (deducted from the loan on completion and not refundable)"

then underneath in section 8 of KFI and offer;-

"If you wish you can add the completion and electronic transfer fees to the mortgage. This would increase the amount you borrow to £? and would increase the payments shown in Section 6. If you want to do this, you should ask for another illustration that shows the effect of this on your monthly payment."

So the default setting is for the fee to be deducted and it will only be added to the loan if you ask for it and a new KFI/Offer will be issued reflecting this.