What costs can I expect to incur for my mortgage ?

Valuation Fee  £200 - £600

The proposed lender will charge a valuation fee, usually linked to the property price. This is the only fee that you will pay up front and cannot be reimbursed if the mortgage does not proceed.

Survey Fee – up to £900

It may be worth commissioning your own survey. There are different levels of report and you can specify from a simple, relatively inexpensive basic report to full structural surveys and specialist reports, which cover trees, electrical systems, damp, and other conditions. You should consider commissioning a full structural survey - especially if the property is old, unusual construction or in need of major repair.

Broker Fee

We do not normally charge a fee for mortgage advice, however this will be dependent on your circumstances. If a fee is charged our typical fee is £250.   

Lender’s Arrangement Fee – typically £399 - 1%

The lender often charges an arrangement fee once the mortgage is complete. This is usually added to the loan. Some lenders don’t charge at all, others will just charge for fixed rate mortgages as a ‘booking fee’. Some will charge an arrangement fee but offer a free valuation – it really does vary from lender to lender.

Higher Lending Charge

The lender's insurer can charge a higher lending charge fee if the loan amount is over 75% of the property valuation. Some lenders will pay this for you if the Loan-to-Value is less than 90%. The fee can be added to the mortgage or paid separately.

Stamp Duty

This is a government tax on property costing more than £175,000. This will vary depending on the value of the property.
1% of purchase price between £175,001 - £250,000
3% of purchase price between £250,001 - £500,000
4% of purchase price over £500,001

Figures accurate as at 31 December 2009.

Legal Fees - £500 - £1,000+

When you purchase a property and apply for a mortgage, or if you are remortgaging, you'll need a solicitor or licensed conveyancer to carry out the legal work for you. You will also need to budget for necessary land registry and local authority searches etc. Ask for a quotation beforehand.

Buildings Insurance

 
You should insure your home for at least the full rebuilding cost against damage caused by major risks such as fire, flood and subsidence. You could extend your level of cover to include full accidental damage. The amount may be different to the market value of the property and will be found in the valuation Report.

Contents Insurance

This is designed to protect all the things in your home, which are not fixtures or fittings. You can usually tailor contents insurance cover to suit your own needs.

Mortgage Repayment Protection

If you become unemployed, or an accident or sickness prevents you from working, this cover ensures that your mortgage payments are covered. You can usually extend your cover to include other regular expenses such as endowment premiums and utility bills.

Life Cover

Most people arrange life assurance cover to pay off the outstanding mortgage loan if they die.  Most lenders will insist that you have adequate life cover in place as a condition of the mortgage.