Mortgage Product Fee

chunkydog Posts: 9
Combo Breaker First Anniversary First Post
edited 29 January at 12:58PM in Mortgages & endowments
Hi, we recently switched our mortgage product with Nationwide, this isn’t due to come into effect until our current fix end on 1st April, however I noticed that the £999 product fee which we opted to have added to the mortgage has already been applied. 

Does this mean we will pay interest on this amount even though the new product does not come into effect for two months? 

I tried to clarify this with NW and they said…

For rate switches the fee will show as added before the product starts but is not interest bearing until the end of the calendar year when they are capitalised”. 

I couldn’t work out whether this means I will pay interest on the amount before the product starts or not and the agent couldn’t advise any further. 

For example when the interest is capitalised at the end  of the calendar year, will this amount include the period prior to the product starting, or does it mean it bears no interest at all until 1st Jan next year?


  • ACG
    ACG Posts: 23,625
    First Anniversary Name Dropper First Post I've helped Parliament
    I would take that as being that your balance has increased, but you wont be paying interest on it until December. 
    But I dont think you can really rely on my understanding. 
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • naf123
    naf123 Posts: 1,694
    Name Dropper Combo Breaker First Post First Anniversary
    I've had similar. I just hope this is refundable if I choose to go to another lender. 
  • Moneysavernov
    Moneysavernov Posts: 20
    First Anniversary First Post Name Dropper
    naf123 said:
    I've had similar. I just hope this is refundable if I choose to go to another lender. 
    It is. You have to ring up and was taken off within a few days 
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