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early redemption penalty
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jj_martinez
Posts: 5 Forumite
my wife and i were forced to sell our house due to our financial situation, because we finished the mortgage 1 year early, the company charged us [£7500.00 redemption penalty, to me this is in the same boat as the banks and their charges, can anyone give any advice on this? would it be worth taking them to court etc
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sorry, but you have no chance of getting this back - it was an inherent part of the loan you signed up to.I am a Mortgage AdviserYou should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it.This signature is here as I follow MSE's Mortgage Adviser code of conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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Where's the problem? You took a mortgage with tie-ins (very common), you finished the mortgage before the tie-in period ended, you got charged the ERCs as per the agreement between yourselves and the mortgage company.
Why would you take them to court? Because they charged you something as per the agreement you signed?
This is nothing whatsoever to do with overdraft charges and the like, and it frustrates me that people think you can claim back anything you like.
Oh please.0 -
i also signed an agreement with the bank about my charges but i can claim them back, so why is it so diferent?0
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What next? "I've been ordering my shopping with Tesco online for a couple of years. Can I claim back the £5 delivery charges?"0
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and _andy_ there is no need to get frustrated, why are you so cross, did you fall out of bet the wrong side this morning, i was only asking the question, as i don't know the answer, it's people like you that make new members not want to post questions.0
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jj_martinez wrote:my wife and i were forced to sell our house due to our financial situation, because we finished the mortgage 1 year early, the company charged us [£7500.00 redemption penalty, to me this is in the same boat as the banks and their charges, can anyone give any advice on this? would it be worth taking them to court etc
None whatsoever. You took an incentive product for a set period of time on the understanding that you would keep it untill the end of that time. If you leave early then you pay a penalty to the lender.
If redemtion penalties are reclaimed and outlawed we would all be paying Standard Variable Rate of 7+% for all mortgages and fixed rates etc would become a thing of the past.
It is not the lender's fault that you had to sell and repay the mortgage therefore why should they lose out financially?0 -
jj_martinez wrote:and _andy_ there is no need to get frustrated, why are you so cross, did you fall out of bet the wrong side this morning, i was only asking the question, as i don't know the answer, it's people like you that make new members not want to post questions.
I didn't know it was possible to fall out of 'bet'.
Anyway, the point is that excessive overdraft charges and the like have been proven to be illegal. Essentially the bank will profit from charging you such a fee.
In the case of mortgage ERCs, the company is merely reclaiming the money they would have made from you if you had stayed with them for that period, therefore the charges are not 'punitive'.
In terms of being cross, yes this sort of question does irritate me somewhat - not because you're asking a question, but the attitude that now exists towards any charges from financial products, i.e. the 'claim it back' mentality, even if there's been no wrong-doing from the company in question.0 -
I agree with everyone so far.
Yes, if you're not sure then ask the question. Please don't jump down people's throats though, some of us (me included) have just started to wise up to 'making some real savings' and we are going to get the occasional thing wrong, but it is all part of the learning process.
Yes, the mortgage lender is a business and we can't go around trying to get money back here, there and everywhere.
I was surprised that my Early Repayment Fee increases the nearer it gets to the 'end of tie-in date', which sounds sort of contradictary to me!! :huh:
Anyway, I'm sure this is part of something I signed, so I'm stuck with it.
Steve0 -
andy
firstly sorry about my typing
in the current situation with people claiming money back from banks etc it's difficult not to wonder weather it's possible to claim charges back in all situations, but again i was only asking a question, and i feel that your reply was pretty hostile, and if you want to put people down asking a question or for a typing error, or spelling mistake, then you need to get out more0 -
all i want to know is, what are these charges for, are they fair and are they legal?0
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