Mortgage seekers would be better off if they do their research before committing themselves to a deal, it has been suggested.
House-hunters scanning the market for a mortgage product that is best suited to their needs should look beyond the advertised initial rate, advised the Council of Mortgage Lenders (CML).
Applicants should also take the time out to look at all the possible options that are available to them, advised Sue Anderson, head of member and external relations at the CML.
"Borrowers clearly need to get a clear picture of the overall benefits and limitations of the mortgage that they might enter into. They need to look at all its features and not just the initial rate," she said.
Her comments follow in the wake of recent findings made public by HSBC, which revealed that between lenders early redemption charges could differ by as much as £6,090.
Moreover, it was also found that exit or closure fees, early payment charges and other costs could often result in high transaction fees for customers. The total redemption charge applied by various lenders on a mortgage for £150,000 could be anything between £1,500 and £7,590.
According to recent statistics published by the Bank of England, the number of new mortgages that were approved dropped to 47,643 in June this year. The figure was lower than that registered in May when 49,461 mortgages were sanctioned.
June also saw the total number of remortgage approvals decrease to 24,949, in comparison to 25,603 in May 2010. It was lower than previous six-month average of 26,366.
However, mortgage applicants can take hope from recent predictions made by market analysts. It has been forecast that the basic bank rate would continue at its present low level of 0.5 per cent, which would without question work in favour of those trying to repay their mortgages. |
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