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FTBs face 35% hike in mortgage fees

First-time buyers could face a 35 per cent increase in their mortgage fees, according to mform.co.uk.

The online mortgage company says bigger fees, smaller discounts and higher rates are three factors affecting the price of first homes.

It says average fees on the top five first-time buyer mortgages have shot up by around 35 per cent since this time last year.

As well as higher deposits – up to 25 per cent of the property price – they also have to deal with higher interest rates.

This time last year FTBs could expect to pay out around £637 in arrangement fees on a best buy mortgage, since then this figure has increased to £857.

mform.co.uk marketing and business development director Francis Ghiloni says: “These are tough times for first time buyers. Lenders are generally asking for larger deposits and with fees and interest rates on the up, borrowers will need to be sure about their ability to meet these commitments before taking a step on to the property ladder.

“Potential borrowers need to be careful now more than ever to take into account the impact of fees on their mortgage in order to make sure that they have a clear idea of the true cost of their mortgage.”

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