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The costs involvedIf you are applying for a mortgage, you will incur certain costs. As well as the cost of engaging a legal adviser, you may also have to pay certain fees, such as
Before we can lend you money to buy your home, we need expert guidance on what the property is worth as security for us. To get that information we may instruct a valuer to visit the property and produce a written report. Alternatively, the value of the property may be assessed by using other valuation methods such as asking a valuer to carry out a quick check of the outside of the property (this is sometimes referred to as a 'drive-by' valuation). We may also assess the value of the property by comparing the details with those of other comparable properties in the vicinity using a specialist database. All of these options have an associated cost and you will be asked to pay this cost before your mortgage completes, unless you have chosen one of our fee-assist mortgages to help with this cost.
For a purchase price/valuation in excess of £5,000,000 contact the valuation department. All the above fees include VAT and an administration fee of £90. Which inspection is right for me? The mortgage valuation The mortgage valuation is solely for our purposes so that we can be satisfied that the property provides sufficient security for us to lend. Where the valuer has carried out a full internal inspection (but not where a drive-by or database valuation has been obtained), we will normally provide you with a copy of the valuer's report. If, however, you are taking advantage of one of our fee assist mortgages and we are refunding or paying the cost of the valuation, you may not receive a copy of the valuation report. If you do receive a copy of the valuation report, please remember it is NOT A SURVEY and does not give any indication as to whether the property is worth what you are paying for it, nor does it provide a list of any repairs that may be needed. In certain circumstances, as an alternative to a physical inspection of the whole of the property, we may, at our discretion, carry out a "Property Assessment". This may be based on database information, an external appraisal of the property by a valuer, or a combination of both. If we carry out a Property Assessment, a fee of £175 is payable by you, which includes a Society administration charge of £90. Applicants will not receive a copy of a Property Assessment Report. We would strongly recommend that you obtain a more detailed inspection of the property. There are two types available, a Home Buyer Survey and Valuation and a Buildings Survey. Home Buyer Survey and Valuation We can arrange to carry out the Home Buyer Survey and Valuation (HBSV) for you at the same time as the mortgage valuation. Presented in a standard format, it is designed to focus on defects and problems which are considered urgent or significant. An HBSV is suitable for properties which are of standard type and construction and appear to be in reasonable condition. If you have already had an HBSV carried out, it may be possible for us to ask your valuer to prepare a mortgage valuation report for us. We will need to see a copy of the HBSV and a copy of the valuer's Professional Indemnity Insurance certificate before we can decide if these are acceptable. If we agree to allow your valuer to prepare a mortgage valuation report for us, there will be a fee of £135. This includes payment to the valuer for the report, VAT and an administration fee of £90. Building Survey This type of survey is suitable for all types of residential properties and, in particular, for period properties, those with extensive accommodation or those in a particularly poor state of repair although it can be done for any type of residential property. It is tailored to your requirements but will be very detailed, covering all defects whether major or minor. There is no standard or scale fee for a Building Survey but the cost will be significantly higher than for the HBSV. Although in most cases, the cost does not include a mortgage valuation, we can arrange for both to be carried out together. You will pay us a Standard Mortgage Valuation fee and pay the valuer the cost of the Building Survey direct. Before the valuer carries out the Building Survey, he will contact you to discuss the scope of the inspection and the cost. If you have already had a Building Survey carried out, it may be possible for us to ask your surveyor to prepare a mortgage valuation for us. Please remember, however, that not all surveyors carry out valuations. We will need to see a copy of the Building Survey and a copy of the surveyor's Professional Indemnity Insurance certificate before we can decide if these are acceptable. If we agree to allow your surveyor to prepare a mortgage valuation report for us, there will be a fee of £135. This includes payment to the valuer for the report, VAT and an administration fee of £90.
Effective from 01/03/2008
Product application fees and early repayment charges are detailed in the relevant product factsheet, the Key Facts Illustration document you should have received before your mortgage application was made, and in your mortgage offer. Your Key Facts Illustration and offer will also detail other fees payable such as mortgage fee, CHAPS fee and valuation fee.
*If your mortgage account falls into arrears by two or more monthly payments a monthly arrears administration fee will be charged unless there is an arrangement in place to fully repay the arrears, which is being maintained. Should the Society take action to enforce the terms of the mortgage, you will be responsible for payment of all fees, including legal fees, which will be added to your mortgage balance. The fees payable will depend upon the type of proceedings the Society has to take. Further details of when fees apply can be found in our booklet ‘How Your Mortgage Works’. Request this information.
With some mortgage products, you may have to pay what's known as an product fee, the first part of which is non-refundable should your mortgage not proceed. The main reason for this is that with some mortgage products, we actually "commit" part of our available funds, so that these are not lent to anyone else. If your mortgage does not complete, we suffer a loss. Normally, you will be asked to pay part of the fee when you apply. You can then pay the remainder of the fee when your mortgage funds are released, or it can be collected as part of the monthly mortgage payment following the next annual review of your account.
Lending a higher proportion of the purchase price of a property brings with it a higher risk to the Society. This risk is reduced by a Higher Lending Charge which provides us with a form of insurance. |
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