Beware short-term fixes when remortgaging

Tim Bennett rounds up the personal finance news, including what nasty surprises may lurk behind short-term loans; and why many people are paying twice-over for long-term care.

Borrowers with a decent amount of equity in their homes should be wary of jumping into headline-grabbing short-term fixes, says Anna Mikhailova in The Sunday Times. That's because there may be a nasty arrangement fee plus other set-up costs lurking behind the eye-catching rate.

For example, Chelsea Building Society's 1.74% two-year fix, available to those with at least 40% equity, comes with a £1,999 fee payable upfront. According to broker London & Country, someone borrowing £150,000 on the Chelsea deal and renewing at the same rate in two years' time (assuming that's even possible) will pay £600 more over five years than someone who takes the best five-year fix from Yorkshire Building Society (a 2.64% rate with a £1,625 fee).

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Tim graduated with a history degree from Cambridge University in 1989 and, after a year of travelling, joined the financial services firm Ernst and Young in 1990, qualifying as a chartered accountant in 1994.

He then moved into financial markets training, designing and running a variety of courses at graduate level and beyond for a range of organisations including the Securities and Investment Institute and UBS. He joined MoneyWeek in 2007.