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Abbey reveals high cost of remortgaging

Abbey estimates that the average upfront cost of remortgaging to a new deal is over 1,000.

The lender says that when you take into account booking and valuation fees, the cost is around 1100.

Abbey says assuming a borrower were to remortgage 12 times during the course of their mortgage, they would be paying 13,596 in fees in their lifetime.

Brokers can help borrowers to reduce up-front costs with mortgage deals that don’t charge booking fees or come with free legal and valuation fees, the lender adds.

Abbey for Intermediaries managing director Ricky Okey says: “Remortgaging can save a borrower a significant amount of money in monthly mortgage payments, but it is important to consider all the fees and charges involved, not just the headline mortgage rate.

The average cost of remortgaging could be 1,100, so a new rate would have to be more than 0.8 per cent cheaper over two years in order to balance out that cost. Brokers should therefore consider offering their clients mortgage deals with no up-front fees to reduce costs.”

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