Chris Cummings, director of AMI, said that most KFIs only showed some of the legal costs involved: “This is a potentially confusing area for consumers,” he said.
Eddie Goldsmith, partner in law firm Goldsmith Williams, agreed confusion was possible. He said: “KFIs are intended to show transparency but borrowers may believe that this is the total legal fee payable.
“Also brokers could be unsure exactly how to disclose any additional fees.”
Nigel Firth, development manager for retail mortgages at Skipton Building Society, explained that the way legal fees were displayed was prescribed by the FSA.
“We were told that we’re only required to show conveyancing fees for setting up mortgage deeds and fees for closing the deeds,” he said.
Robin Gordon-Walker, spokesman for the FSA, said: “Legal fees don’t have to be on KFIs but it would obviously benefit the well-informed borrower if they knew the total fee up front.”
