Reservation Fee

This is a "front end" charge levied by several home lenders. The idea is you're asked to pay the fee (typically between £100 and £300) to secure the funds you're intending to borrow. It's sometimes described as an Adminstration Fee or a booking fee.

Reservation fees are often levied on fixed rate mortgage offers where the funds on offer may be limited.

Some lenders believe the fee is a useful way of getting the borrower to show commitment at an early stage. Some, but not all reservation fees are refundable should the home loan not go ahead.

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See also: Financial Services, Mortgages