Alliance & Leicester "administration" (!?!) charges

kt

Pobman wrote:

I've just successfully got Woolwich to reduce the exit charge back to the £95 as per my original contract in 2001 - in the interim it had increased to £275.

It took 3 letters - first two were fobbed off. 3rd letter I threatened to refer to the Ombudsman and/or take them to Court. The have refunded the £180 difference as "a gesture of goodwill".

Redeemed in June - paid the full fee to get out clean, it's taken a month to get them to refund the £180, but worth it for a few letters. It think they are sailing very close to the wind with this issue and I await the FSA review in the Autumn with interest, albeit a passive interest.

Pobman

I am in the process of trying to pay off our mortgage. I have been told that there is a Final Repayment Fee of £275. When I originally changed my mortgage - still with the Woolwich I asked if the would be any early redemption fees. I was told no and have a letter which states "This product has no Early Repayment Charges". I am in the process of complaining about this, particularly when the figure appears to have risen from £180 during the last year. I have not been advised of this and they have said they tell customers when they receive their annual statement. I haven't received mine yet. So am I justified in refusing to pay the £275. I begrudge even paying the £180 as I wasn't informed about this?

It has also occurred to me that if I settle most of the mortgage and leave say £300 outstanding - paid off at £5 per month over the next 4yrs 3 months I would not have to pay this fee and the interest would be less. Would I get away with this. Your comments would be gratefully received.

elpollodiablo

Hi all,

I took out a mortgage with A&L in November 2005, approximately a year after the price increase to £295. Is there anybody out there who is in a similar situation and have negotiated the fee down? Or am I lumped with the cost because that's what I originally signed up for?

Thanks for reading.

ericthekidstoner

elpollodiablo wrote: »

Hi all,

I took out a mortgage with A&L in November 2005, approximately a year after the price increase to £295. Is there anybody out there who is in a similar situation and have negotiated the fee down? Or am I lumped with the cost because that's what I originally signed up for?

Thanks for reading.

it tooks 3 letters and eventually they refunded the lot for me

try Martin's templates

MarkyMarkD

elpollo signed up to the £295 charge. There's no earthly reason why they shouldn't pay it.

ericthekidstoner

correct me if I'm wrong but isn't it based on the legal position that the fees are disproportionate and therefore illegal

noh

ericthekidstoner wrote: »

correct me if I'm wrong but isn't it based on the legal position that the fees are disproportionate and therefore illegal

No its not. Its based on the position that the fees being charged are not what was agreed when the mortgage was taken out.

Nigel

dunstonh

ericthekidstoner wrote: »

correct me if I'm wrong but isn't it based on the legal position that the fees are disproportionate and therefore illegal

The fees are not penalty charges and therefore the "justification of amount" doesnt apply.

However, the FSA has treating customers fairly (TCF) rules that state that fees should be reasonable. They have stated that the increases that have occured on these fees is unreasonable and that they should honour the original amount on the contract. Although they would allow small increases for inflation purposes.

dfarry

dfarry wrote: »

Good news for those that are questioning the Woolwichs' Final Repayment Charge.

I had a letter this morning...I quote the key paragraph:-



:j :j :j :j :j

Clearly, they don't want to admit that they and all the other banks are blatantly ripping off their borrowers and therefore respond with the gesture of goodwill. Obviously it's a "good little earner" for them so preventing the wider public from becoming aware of this they would rather pay off a few unhappy customers.

From my point of view I am very happy (many thanks to those on here that have offered advice, help and struggled with the lenders before me). By applying the £275 to my account it will also save me a small amount of interest until redemption so that is good. If the move falls through (it's been a bit of a struggle) then I assume the Woolwich will want the £275 back plus interest....but maybe not....

Just as an update really.

My move did fall through... so I asked the Woolwich if they wanted me to refund them the £275... they said it was a gesture of goodwill and therefore that would not be necessary :j

However I will shortly be looking to remortgage so I'll have to pay the fee at some point (in the meantime at least my mortgage has been saved some interest).

elpollodiablo

dunstonh wrote: »

The fees are not penalty charges and therefore the "justification of amount" doesnt apply.

However, the FSA has treating customers fairly (TCF) rules that state that fees should be reasonable. They have stated that the increases that have occured on these fees is unreasonable and that they should honour the original amount on the contract. Although they would allow small increases for inflation purposes.

Thanks for the replies, everybody.

Even with the £295 fee, I can still save £500-ish by remorgaging with the Britannia.

Dan_Collins_2

You will find that your KFI or offer document will now state the fee also they now state that it is currently.

Its funny that since the FSA took reg over the fee's went up! Its cost lenders a lot of cash when the FSA reg started, lenders have had to get this back some how! Because of the FSA these fees had to be increased in the first place and then they charge the lender £500 just to go talk about the complaint!

Most lenders are dropping the charge but guess what, they will just stick it else where. If you signed up to an admin charge of 250-300 then tough, although I do agree that if you signed up to £50-£75 then the higher is a jump to high!

Remember you wanted the mortgage and signed up, its now you have the hump because you ignored or missed the charge!