Mortgage fees rise despite a rate cut.

Financial Adviser, December, 2007

Byline: Slashed base rate fails to translate into borrower rates

Mortgage lenders are recording astronomical increases in mortgage application fees that can top AGBP10,000 meaning any cut in borrowing rates offered by lenders will offer little benefit.

The Abbey has the highest fee of AGBP9999 on a fixed-rate deal of 5.59 per cent for loans of between AGBP500,000 and AGBP750,000.

A week after the Bank of England cut its base rate few mortgage lenders had passed on the cut to borrowers while many have slashed the percentage paid to savers.

Egg has become the first mortgage lender to decide not to pass on to borrowers the full benefit of last week's rate cut. The lender, which is owned by Citigroup, will cut its standard variable rate...

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