Any way to avoid mortgage arrangement fees? - HotUKDeals
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Any way to avoid mortgage arrangement fees?

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banned7y, 5m agoPosted 7 years, 5 months ago
I'm looking to take out a mortgage for moving to another house.
I've seen some interesting deals from Alliance Leicester, including some nice tracker deals but alas they seem to have some huge arrangement fees (2% or more) which equates to a few thousand pounds.
I appreciate they also do another deal or two where the fee is mcuh much less, but the amount you pay monthly goes up to compensate it seems (i.e. the tracker percentage rate is higher).

I think this is the same with other lenders too.

Does anyone know of a way to get rid of the arrangement fees somehow, perhaps by having an account with the lender, or using some special deal or whatever?

Also, if anyone knows of a tracker deal better than the Alliance and Leicester, please do let me know.

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banned7y, 5m agoPosted 7 years, 5 months ago

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they'll usually let you add this to the mortgage balance rather than cough up at the start......but then be aware you pay interest on that extra borrowing so not always a great idea
A worse interest rate means that they cut down the arrangement fee.
A worse interest rate means that they cut down the arrangement fee.

As above you are paying the fee for getting the low rate, loan to value will also make difference to rate available
Make sure you do all the maths as to what the total payback is.

A low rate with high arrangement may well work out the same as a high interest with low arrangement.

It wouldn't surprise me if some of the low interst rates work out more expensive, with the banks knowing people will just look at the low interest rate and go for that one without checking.

I've been advised by a couple of people to avoid tracker mortgages as the Bank of England rate is unlikely to go any lower, and if anything will probably start to rise again soon, thus pushing the monthly payments up.

The arrangement fees on fixed rate mortgages look more attractive - at least the 3 or 4 that I looked at earlier did anyway. I guess I'll check out some fixed rate deals.

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