Put simply, a fee-free mortgage is one where you don’t have to pay the lender an arrangement fee. This can sound very appealing. However, fee-free mortgage deals often come with higher interest rates than those where you pay an upfront fee. This means that over the course of the loan you could end up paying more. Lenders usually offer a choice of both fee-free and upfront fee deals – typically £995 – for most circumstances. You can add the fee to your loan, but this will result in you paying interest on it for the entire term of the mortgage.
So, is it more cost effective to have a higher rate mortgage with no fee or a lower rate mortgage with an arrangement fee? Our independent team at Vincent Burch Mortgage Services will help you find the most appropriate answer and guide you through the mortgage maze.
To understand whether this is the right type of mortgage for your needs you can speak to our fee-free mortgage advisers. We have extensive experience in calculating the overall cost of mortgages and have access to the best fee-free mortgage rates available. As an independent broker we have your best interests at heart and will help you make the most cost-effective choice without charging you a fee.