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Nationwide Building Society has called for lenders to abolish Higher Lending Charges (HLCs).
Consumers are expected to spend £200 million during this year alone.
It's predicted nearly 100,000 borrowers will be affected with each paying an average charge of £2,000.
Nationwide abolished its higher lending charge over five years ago but many High Street lenders still charge this fee for customers borrowing more than 90% of the value of their property.
The fee covers the lender in case borrowers default on their loans. While it can be added to the mortgage, over 25 years a £2,000 higher lending charge could end up costing borrowers around £3,800.
Nationwide's executive director, Stuart Bernau, said: "Not only are higher
lending charges unwelcome for homebuyers, they are also avoidable.
"Consumers need to be aware that the headline interest rate is not all they pay.
They must also take into account the fees and charges that form part of their
mortgage deal."
Source:
Getting Paid
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