Mortgage guide
Mortgage fees and costs explained
The interest rate is only one part of the cost of a mortgage. Product fees, valuation costs, legal work, broker charges and Early Repayment Charges can all affect whether one mortgage is genuinely cheaper than another.
Product charges
Mortgage products can carry arrangement or booking fees.
MoneyHelper notes that lenders can charge a range of mortgage-related fees. Common examples include product, arrangement or booking fees.
Some fees are paid upfront; others can sometimes be added to the mortgage. Adding a fee to the loan can reduce the immediate cash cost, but interest may then be charged on that fee over the mortgage term.
A fee-free product can have a higher interest rate, while a fee-charging product can be cheaper over the period you expect to keep it. The whole package needs comparing.
Valuation & survey
The lender's valuation and your survey are different costs for different purposes.
The lender may charge for a mortgage valuation, although some products include a free or subsidised valuation.
The valuation is primarily for the lender. If you want a more detailed assessment of the property's condition, you may choose to arrange your own survey separately.
Lender valuation
Used to help the lender decide whether the property is acceptable security for the mortgage.
Buyer survey
Provides information for you about the property's condition and potential defects, depending on the survey level chosen.
Legal work
Buying or remortgaging can involve conveyancing costs.
For a property purchase, your solicitor or conveyancer handles the legal transfer, searches and other work needed to complete the transaction.
A remortgage to a new lender also normally requires legal work to repay the existing lender and register the new mortgage. Some remortgage products include free legal services or a contribution towards costs.
Check what is actually covered and whether additional charges apply for more complex work.
Mortgage advice
A broker or adviser may charge a separate fee.
Mortgage advisers can be paid through a client fee, commission from the lender, or a combination depending on the firm's charging model and the mortgage arranged.
Where a client fee applies, it should be disclosed before you proceed so you understand what you will pay and when.
Leaving a mortgage early
Early Repayment Charges can be one of the largest switching costs.
An Early Repayment Charge — ERC — can apply if you repay or switch a mortgage during a specified deal period. The percentage or amount and the period for which it applies are set out in the mortgage terms.
The FCA requires applicable charges to be disclosed in regulated mortgage information.
A new lender's lower rate may not save money if the cost of leaving the existing deal is too high.
Overall cost
Use the mortgage illustration to compare the deal properly.
Interest rate
What rate applies and for how long?
Product fee
How much is it, and will it be paid upfront or added to the mortgage?
Incentives
Cashback, free valuation or legal services can affect the net cost.
ERC
What would it cost to leave the deal early?
Reversion rate
What happens after the initial deal ends?
APRC
The Annual Percentage Rate of Charge can help illustrate the overall mortgage cost, although it may assume you keep the mortgage for the full term.
If you plan to review the mortgage in two or five years, a full-term cost figure alone may not answer the question you actually need to solve.
Mortgage advice
Comparing two mortgage deals?
We can compare the rate, product fee, incentives, early repayment charges and expected holding period so the decision is based on overall cost rather than the headline rate alone.
Book a conversationThis guide is for general information only and is not personal mortgage or financial advice. Mortgage fees, product terms and lender charges vary and can change. Your home may be repossessed if you do not keep up repayments on your mortgage. Content checked against current FCA and MoneyHelper guidance on 16 September 2026.