High fees warning for long-term mortgages

Borrowers who have heeded recent industry recommendations and taken out a long-term mortgage have been advised that they may be liable for large fines if they change their mind and look to change deals.

Moneysupermarket.com has advised that early repayment charges (ERCs) of up to £10,000 are applicable to some long-term deals if borrowers look to switch after two years.

The advice comes as Stroud & Swindon has suggested that long-term deals could be a more expensive option for first-time buyers.

"The trouble with committing to a longer-term mortgage is people never know how their circumstances may change. If they have to exit quickly they may get a painful payment shock," said Louise Cuming of moneysupermarket.com.

Stroud & Swindon's research found that the cheapest mortgage product for borrowers over the past decade would have been a two-year fixed-rate deal.

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