In order to cover their costs of processing applications and booking preferential rates, more and more lenders are imposing non-refundable fees, with the average fee reaching £405, according to a recent survey.
It has been observed that almost one in five lenders are currently charging non-refundable booking fees on some of their mortgages, even if a borrower is unsuccessful with the application.
In reply to this, lenders argue that they face high costs in processing applications and if they reserve a product for a customer, which they are fine with, then that is acceptable as far as it goes.
However, if customers are turned down for a mortgage or are forced to pull out of a deal, it will be an unpleasant and unexpected surprise to find that it is going to cost you a lot of money for even not getting the mortgage you wanted.
Therefore, before going for a deal, it is important for customers to be certain that they really want a mortgage when they start this process, otherwise they could end up incurring unnecessary costs.