Fees payable on sub-prime mortgages have risen "dramatically" over the last six months, increasing by 13.5 per cent on average, MoneyExpert.com has revealed.
Moreover, the number of sub-prime mortgages with a fee totalling over £1,000 has exploded by over 46 per cent in the last six months.
In further bad news for sub-prime customers, the number of 'fee-free' mortgages available to people with adverse credit has dropped by 81 per cent from 71 to just 13 since the first of the base rate increases in August.
MoneyExpert.com's chief executive Sean Gardner described the rise in fees as "startling", adding: "High arrangement fees can skew the effective rate of interest you'll get on your mortgage, so don't pay the price for poor research."
He welcomed recent news that one in five mortgage brokers plans to increase the number of sub-prime mortgages they offer over the next 12 months, remarking: "Many people rely on sub prime mortgages, from the self-employed to people who have very poor credit ratings."
But many financial advisers are concerned to constrain sub-prime lending, anxious that customers take on debt without fully mapping out their repayment potential.For more information about bad credit mortgages, click here.
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