It's important to know just what we can and can’t do with a loan, and what the costs are, before signing up.

What fees do you charge?

For all loans, ask about application fees and other charges such as a low equity fee.

For fixed-interest loans, ask what fees apply if you increase repayments, make lump sum repayments, or repay the whole loan early.

What will be the total cost of this loan, including fees and interest, for the sum I am borrowing and the term I have chosen?

The lender will have to make an assumption about interest rates to do this calculation. But it will show how much you’ll pay back in total. (Note that the lender is required to disclose the fees and interest separately.)

Also, ask for the total regular payment in a year if the interest rate were to be 1% higher than now. That will give you some idea of the risk if rates rise.

What changes can I make after the mortgage is set up?

For all loans, ask whether it's possible to increase regular payments from time to time, pay in lump sums, and pay off the mortgage in full before the end of its term.

Ask if there is a required period of notice before reducing or paying off the loan with a one-off payment.

Fixed-interest loans normally convert to a floating rate at the end of the term - ask about taking another fixed term instead at no charge.

If I buy a new house, can I transfer the existing mortgage?

If the answer is yes, it's likely to save money in fees.

 

If I have a problem that I can’t sort out with you, where can I go for help?

Approach the lender with a complaint or problem in the first instance. If that doesn't result in a satisfactory resolution there are independent bodies available which can investigate and help settle disputes such as the Banking Ombudsman and the Financial Services Federation, which represents some non-bank lenders.

 

 

TRY THE SORTED MORTGAGE REPAYMENT CALCULATOR