| Although much publicity has been given to the | | | | could already be set to face a rise in mortgage |
| effect that higher interest rates on mortgages will | | | | costs as they come to the end of their fixed-rate |
| have for homeowners this is not the only area of | | | | deals. The price comparison website stated |
| rising demand that these consumers will face, it | | | | around 1.4 million homeowners are set to see |
| has been claimed. | | | | their mortgage deals expire over the course of |
| In a study carried out by uSwitch, it was revealed | | | | this year and that those who are unable to |
| that some 38 percent of homeowning Britons - | | | | secure a similarly-priced product will see their |
| about eight million people - have chosen to spread | | | | monthly repayments "increase considerably". Ms |
| arrangement fees across the term of their | | | | Robinson added: "Piling on almost another 30 |
| mortgage repayments. And although not having | | | | pounds a month for arrangement fees is just |
| to meet the full cost of arrangement fees after | | | | adding insult to injury." |
| first securing a mortgage may seem to save | | | | Furthermore, exit fees were shown to be |
| consumers from needing to come up with more | | | | another area of constrain for homeowners. At |
| money early on in their period of homeownership, | | | | present the typical charge for switching to |
| it was revealed doing so will place them under | | | | another mortgage supplier stands at 163 pounds, |
| more financial pressure. | | | | although this can be as high as 295 pounds. |
| At present the typical set-up expense for a | | | | In an attempt to lower strains on their money |
| mortgage stands at 986 pounds. However, by | | | | management, uSwitch advised consumers to |
| adding this charge to a 25-year mortgage, | | | | attempt to make over payments on their |
| uSwitch showed that costs would rise to 2,094 | | | | mortgage. By doing so, it was claimed that |
| pounds. Such a figure amounts to an increase of | | | | homeowners could "significantly reduce" the length |
| 112 percent from the original fee. For those opting | | | | of mortgage repayments and negate the impact |
| for a mortgage which charges the highest fees | | | | of adding arrangement fees. Looking beyond the |
| (4,094 pounds), meanwhile, costs over a 25-year | | | | headline rates advertised on lending and getting a |
| period would rise to a "staggering" 8,692 pounds. | | | | key facts illustration to provide an individualized |
| This, it was revealed, would add about 30 pounds | | | | quote should help lenders determine exactly how |
| on to consumers' monthly repayments. | | | | much they will have to pay. |
| Following on from facing higher mortgage fees, it | | | | Homeowners worried about the various pressures |
| may be possible that consumers develop | | | | that their finances are under might wish to |
| difficulties in managing other demands on their | | | | consider taking out a loan. By using such a |
| spending. Such areas could well include personal | | | | low-rate loan as a means of debt consolidation, |
| loans, credit and store cards, council tax | | | | borrowers may find that they are able to pay for |
| payments and utility bills. | | | | numerous property-related expenses such as |
| Commenting on the figures, Ann Robinson, | | | | arrangement fees and mortgage repayments |
| director of consumer policy for uSwitch, said: | | | | quickly, leaving them with a single affordable |
| "This is a real catch-22 for consumers who are | | | | monthly repayment. Getting a debt consolidation |
| struggling to find the funds to pay mortgage | | | | loan might also assist consumers to meet |
| set-up costs. In fact, by allowing consumers to | | | | spending commitments such as household bills and |
| add fees on to the mortgage, it could be argued | | | | credit cards. Doing so could be of particular help to |
| that providers are doing them a good turn. This is | | | | a significant number of Britons after a recent |
| particularly true for first-time buyers where it | | | | Equifax study showed that 41 per cent of people |
| could mean the difference between getting on the | | | | with a fixed-rate mortgage will see their deal |
| property ladder or not. However, adding fees to a | | | | expire over the course of this year. Out of such |
| mortgage means that you will be spreading the | | | | consumers it was indicated that about two-thirds |
| amount over many years and paying interest for | | | | are yet to look for a new deal, a figure |
| the pleasure of doing so - this is an extremely | | | | suggested to be one "of concern" as numerous |
| expensive option and should always be seen as a | | | | lenders withdraw their cheap products. In addition, |
| last resort." | | | | 59 percent of people were indicated as being at |
| It was also pointed out that many homeowners | | | | least 5,000 pounds in debt. |