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Best website to compare mortgage rates7/27/2023 Some lenders offer cashback and other incentives to make their deals more attractive to potential customers - but you should always weigh up whether a quick injection of cash is worth it if it means paying back more in the long run. Should you choose a mortgage offering cashback? While it can be interesting to see how deals compare on this measure, the APRC won't be that useful if you're planning to remortgage when your initial period ends - which you almost always should. This means the APRC incorporates the initial rate and fees but also the SVR, which you'd be moved onto at the end of the initial deal period. When you compare mortgages online, you'll usually see a column called 'APRC'.Ī mortgage deal's annual percentage rate of charge (APRC) is a calculation of how much you'd pay if you stuck with the deal for its entire term, until you've paid off the mortgage in full. You can sometimes avoid ERCs by getting a portable mortgage, which you can take with you when you move home - but bear in mind your old mortgage might not be the most suitable for your new property. Up-front fees can add to the cost of borrowing, but early repayment charges (ERCs) could sting you further down the line if you choose the wrong fixed term on your mortgage.ĮRCs are generally charged on fixed-rate mortgages of five years or longer, and they mean that if you decide to pay off the mortgage early (including by moving home and taking out a new mortgage), you may need to pay thousands in charges.ĮRCs can be as much as 5% of the balance in the first year of your mortgage, before dropping each year thereafter. It can be possible to add arrangement fees to your mortgage balance, but this usually isn't advisable, as you'll then need to pay interest on them. Some lenders offer fee-free deals, but the mortgages with the cheapest interest rates usually come with hefty up-front fees.
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