Mortgages. Be aware of the higher lending charge sting. Page 2

Summary

If you have a mortgage, and that is more than 90% of your property value, you may well have to pay a higher lending charge. This article gives you the lowdown.

 

Author - Anna Richardson

Luckily, the majority of the lenders will allow the higher lending charge

Mortgage Research Good News for House Buyers
Coments on the direction of interest rates and the mortgage market.
Mortgages. Encouraging stronger personal economic growth
You have to shop around for a good internet rate whether it be fixed or adjustable (variable).
Foreign Currency Mortgages. What are they and what are the risks?
Foreign currency mortgages could save you a lot of money but the risks are high. This article explains.
Buy to Let Mortgages. Boom time returns.
Buy-to-let mortgages are booming again. What's changed and what, as a new landlord, do you need to look out for?
Mortgages. Watch out for add-on charges.
Mortgage lenders use headline interest rates to attract borrowers. But behind the scenes they're introducing a whole raft of add on charges. This article explains.
House price rises – a cautionary tale
The housing market seems to be buoyant with house sales exceeding expectations in some parts of the country. If mortgage rates start to rise, the market may see a correction. Take care not to take on too much debt.
Life Insurance News
to be added on to your mortgage ( best mortgages ) at the outset. However, you'll still have to pay interest on that, which means over 25 years, that could be an extra £2700 to pay.

We think that the higher lending charge should be banned. It is not fair for a lender to insure themselves against the possibility of you defaulting on your mortgage. If they don't want to lend to you, then they ( term assurance ) shouldn't. They do enough credit checks on you to be able to tell if you're going to cause them problems -- at least, they should! It really is an extra and unnecessary charge, because with a mortgage of over 90%, you end up paying more in other charges anyway.

The Nationwide Building Society does not charge a higher lending charge, and they recently publicised the fact that homeowners have paid out £1 billion over the last five years on this particular charge. That means ( insurance ) 800,000 borrowers have paid this charge. 500,000 of them were first-time buyers, the very people that really couldn't afford to pay the charge. The higher lending charge was previously called the mortgage indemnity guarantee - they may have changed the name, but we haven't been fooled!

The Office of Fair Trading recently made some changes within the credit card industry, forcing a number of credit card companies to reduce their charges by up to 40%. We think it's time they took another look at the mortgage industry too.

Stamp Duty rates in the UK - house purchases

Up to £125,000 0%

£125,000 - £250,000 1%

£250,000 - £500,000 2%

Over £500,000 4%

*The price for your house will be rounded up to the nearest £5, so if you buy a house for £124,996 then it will be rounded up to £125,000, and you'll still have to pay a 1% duty.

Statutory Wealth Warning:
Your home may be repossessed if you do not keep up your repayments on a mortgage or any debt secured on it. Security by way of a charge on your home may be required.

The URL for this web site is owned by Trunk Internet Ltd. Alliance Internet Ltd under agreement with Trunk Internet Ltd, uses, runs, manages, operates, designs, and produces copy and displays information on this web site.