ConsumerValue: Housing
3. Other fees and charges
Besides the mortgage and legal fees, a number of other costs are involved in buying a home. But in some cases you can avoid or reduce them, and you can really save money if you do your homework and if you are prepared to shop around. For example:
Administration fee
Some lenders charge this fee to cover the cost of administration and sourcing funds. You will not get your money back if you do not go ahead with your mortgage application.
Arrangement fee
Some lenders charge a fee to arrange the loan. This can be around 0.5% of the total cost of the home loan.
Brokers' fees
Some brokers charge a fee to give you mortgage advice or to arrange your mortgage. Many brokers do not charge a fee, so it's worthwhile to check in advance.
Estate agents' fees
If you are selling your home, you will have to pay fees if you hire an estate agent to handle the sale.
You will usually have to pay between 1% and 2% of the sale price or sometimes there is a flat fee.
Indemnity bond
This is an insurance policy, in favour of your lender, to cover any shortfall that might arise between the amount you owe and the value of your home if you fail to meet your repayments.
An indemnity bond is usually required when you are borrowing more than a certain percentage of the purchase price. Many lenders waive this fee for first-time buyers.
Lenders' valuation fee
The valuation fee is the most common fee that lenders charge. It is used to pay a professional valuer to estimate your property's market value.
Some lenders choose the valuer you must use, others allow you to choose your own.
The fee is usually between €100 and €150. Most lenders will refund this fee to you if one of their panel of valuers has carried out a valuation for you and, for some reason, your mortgage is later refused.
Structural survey fee
This is a survey to assess the structural condition of the property you want to buy. It is usually carried out by an engineer or architect and the costs depend on which firm you use.
Building Energy Rating
From 1 January 2009 a BER (Building Energy Rating) certificate is compulsory for all homes being sold or rented in Ireland.
A BER is similar to the energy label for a household electrical appliance like your fridge.
The label has a scale of A-G. A-rated homes are the most energy efficient and G the least efficient.
This means that the energy needs and efficiency of different properties can be compared and that you can find out how a property will perform as regards heating comfort and cost before you buy or rent it.
BERs will be carried out by specially trained BER assessors, registered by Sustainable Energy Ireland (SEI). A list of BER Assessors is available on the SEI website.
There is no standardised fee for a BER assessment, although a range of €280 to €350 seems average for apartments and standard three-bedroom semi-detached properties.
Again, this is a competitive market, so seek several quotes and feel free to discuss the quotes with your preferred BER Assessor.