The cost of getting a mortgage or loan.Arrangement FEEs

sinbinjack

When did it become normal to charge an arrangement fee when applying for a loan. I can remember asking my BS for a mortgage and don't remember there being an arrangement fee. I definitely would remember fees in the thousand pound range,. Why would you need to pay extra for a loan as I thought they made their profit from the interest rate. Now I might understand it if the person getting me the loan was a third party and remote from the lender but when the lender wants to charge a fee I get suspicious . I must say that I don't get or have any loans, luckily don't need them, but I see so many people having to pay and don't see any really good reason why this should be.

amnblog

You don't need a loan, but have a problem with those that do having to pay fees for them?

kingstreet

sinbinjack wrote: »

Now I might understand it if the person getting me the loan was a third party and remote from the lender

There usually are third-party market counterparties who provide the rate swaps to make fixed rates possible.

A very low rate with a fee will suit bigger mortgages whereas a higher rate without a fee will suit a smaller one.

If there were no fees, everyone would pay a higher rate.