Visit from Mortgage Advisor

Jag1978

Hi All

Had my mortgage advisor down looking for the mortgage for us. He based it round arrangement fee – So high, zero and medium. We’ve got about £82k to pay off. I wanted a Tracker, with free legal, valuation and possible freedom to overpay to reduce my payment. All this over 23 years.

These are the three he recommended:

• C&G @ 4.78% which is 0.47% below base. Free Legal and Valuation. Restrictions apply on overpayment –arrangement fee of £2185!!! Monthly payments of £490 not including arrangement

• Nationwide @ 6.74% - 1.49% over base. Free Valuation no Legal – No arrangement fee and monthly payment £585

• Scottish Widows @ 5.79% - 0.54% over base. Free Valuation. Legal and Flexibility to Overpay without penalties. Arrangement fees of £524 - Payment of around £530 per month

I like the idea of C&G but don’t like the arrangement fee. I’m thinking off paying the arrangement fee off in one lump but don’t think £2185 is worth it for just a 2 year deal. Nationwide isn’t really that flexible. The advisors recommendation was Scottish Widows as it seems to meet my criteria.. Wondering if anyone else has any opinions.

Regards

Jit

Trying_to_be_good

You're thinking on the right lines, but only you can make the decision knowing your personal circumstances.

E.g. Nationwide will allow you to pay off and extra £500 per month - if you can regularly overpay by more than that you may want to consider reducing the term of the mortgage, i.e. pay more each month but for fewer months.

AndrewSmith

It is generally considered best to arrange for the set up fees to be added to the loan when submitting the application.

This is to offer you some protection should you decide not to go through with the mortgage after offer, or should your mortgage be declined after you have paid the fees etc etc.

If you elect for the fees to be added to the loan then you only pay for any valuation fees or non addable fees (not often but some lenders ask for an up front non addable nominal fee) thus it is only these fees at risk should the mortgage not proceed for whatever reason.

Read the T&C's on the lenders declaration on the application form as some will ask you for credit/debit card details and take a small fee of £99 should you not proceed however it is better to do this than pay a fee of, for example, £699 as an arrangement fee up front only to find that you do not proceed and lose this money.

After completion you can then overpay the mortgage in the first few months to effectively pay off the fees you have added.

Andrew