Wednesday, December 19, 2007

Mortgages: Best Buy tables...the problems

Are mortgage best buy tables you see in newspapers misleading?

The biggest problem is Lenders know how to manipulate them, the biggest snare is usually the ones at the top have large arrangement fees. Lenders use the arrangement fee as part of the cost of the deal rather than reflecting their administration costs

There are a number of problems with mortgage best buy tables. They don't contain important information such as:

1 Miss Loan to value (how much of the property value can you borrow)
2 Loan size
3 higher Lending charges
4 Applicant's salary & profession
5 Type of property
6 How long is the rate for? 6 months?
7 Is interest calculated daily or annually?

There are 12 000 mortgage products on the market, so maybe it's worth getting advice from an independent professional.

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