» Read the complete article

Is there anything worse than being turned down for a mortgage or having to pull out of a deal? Yes there is, if the mortgage application had a non-refundable booking fee attached to it.

According to Evaluate Technologies, people who have been turned down for a mortgage or have decided not to take a mortgage can still be hit by more than £1,000. Its analysis shows up to 19 lenders – around one in five of all lenders – currently charge non-refundable booking fees on some of their mortgage products ranging from £100 to as much as £999.

Lenders are increasingly imposing non-refundable fees to cover their costs in processing applications and booking preferential rates. But with more adverse borrowers at risk of failing to complete applications, many could lose out.

Julie Speed, national accounts director at Evaluate Technologies says: “The picture on fees is becoming more and more confused and the issue of non-refundable fees is not helping. Lenders will argue that they face costs in processing applications and if they reserve a product for a customer and that is fine as far as it goes.

“But if customers are turned down for a mortgage or are forced to pull out of a deal it will be an extremely unpleasant surprise to find that not getting the mortgage you wanted is going to cost you a lot of money."

Simply, go to a mortgage broker if you want to avoid a situation whereby you have to pull out or are turned down for a mortgage after the application process. A mortgage adviser will not only check and double check that the mortgage is what you want, but they will only help you apply for loans that you can realistically get. The mortgage market is a minefield, so get some help navigating it or it could cost you dear.
 
SOURCE: Evaluate, 03/11/09

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.