What does Reservation Fee mean?

The reservation fee is an upfront payable to your lender amount. This amount has the same role as an arrangement fee when you contract a mortgage. Usually this fee doesn’t exceed £300, and it is like a ‘reservation” of the funds you wish to borrow. Many lenders require a reservation fee, but it is most typical in the case of the fixed rate mortgages. Many times if your application is not accepted, you will not recover this fee, and this is why you need to check terms and conditions to know from beforehand whether you will get back this fee or not.