Mortgage Reservation Fees

IvanOpinion

It has come to that time again when I need to remortgage to get a better deal - my current deal runs out mid-January. We are currently with the Nationwide and they do seem to have a couple of good deals - 4.75% 2 year tracker or 4.95% 2 year fixed.

My question though is that there seems to be a £349 reservation fee. This seems awfully high, does anybody know if this is negotiable to any degree.

Also, does anybody know how long a quote from the Nationwide is valid for 20 days, 60 days, 90 days? I would like to try to book this early (just in case interest rates go up next month).

Thanks
Ivan

martinhp

BM Solutions have a 2 year tracker at 4.69. Free legals and refund of valuation. Other than that the n/wide deal is hard to beat. N/wide fixed rate deal is the best you will get.

The Nationwide quotes are never valid. Rates are only booked when the fee is paid

MarkyMarkD

My question though is that there seems to be a £349 reservation fee.  This seems awfully high, does anybody know if this is negotiable to any degree.

£349 isn't high at all.

If you are borrowing a small amount, opt for a mortgage with no fee (and valuation fees and legal fees refunded) - but you'll pay a higher rate.

If you are borrowing a larger amount, the £349 fee becomes relatively trivial.

£349 only costs you around 0.175% pa over two years on a £100k mortgage.

payless

and remember the differenet lenders also have different exit costs
early repayment charge
(- the new "correct name for redemption fees) which may not be an issue if you go the term of the deal/ period

BUT also look at the lenders account closing/ sealing/ deeds release fees

Robert_Sterling_3

By charging an "arrangement fee" the lender can show a lower "Headline interest rate" on a mortgage.
The arrangement fee is a factor taken into account in the calculation of the APR which of course is not the rate actually charged on the mortgage.  This means that you can fool some of the customers some of the time.

Fairdo_2

To back up the previous answers, the arrangement fees are relative. It can be worth it if the monthly saving is suffient over the preferential rate term.

It may not be something that that you are used to if you have dealt with Nationwide, as they increased thier arrangement fees twice in fairly quick succession. However, a benefit of staying with them is that it should be fairly straight forward with Nationwide as it is a Product Transfer, as opposed to a full legal Remortgage. Therefore, no new survey would be required and no legal work is required with Nationwide. However, as also stated, some lenders do provide these services for free if there are no complicated restrictions with the remortgage.