Bank took mortgage payment 4 days after remortgage to new lender - compensation?

michaels

My remortgage went through on the 2nd March. HSBC my old lender took payment by direct debit on 6th March even though they no longer had any mortgage with me and had been paid off in full. They have still not yet returned the funds. What sort of compensation should I be looking for from them - lost interest only or some sort of good will payment on top.

I am sure it is just an admin error but it just feels like theft when people take money from your account that they have no right to.

AndrewSmith

You have every right to a return of the funds under the Direct Debit guarantee, which you should be given every time you sign a direct debit mandate.

I would actually go in to your local HSBC branch and demand the funds are replaced immediately plus any costs incurred.

This is exactly why I tell every client that the most important thing to do once completion has taken place is to cancel the old direct debit immediately.

Andy

payless

Given you repaid the old mortgage on Thursday, there's a good chance the DD run was already in for the collections Sat-Monday (4th-6th)

Even if under notice of redemption , they would not have been certain of redemption until it happened .

That said repayment of this DD payment should have been made in a timely manner - chase them up ( even possible they sent funds to the solicitor dealing)

Joe_Bloggs

This has happened to me and I knew it would. There was a two week backlog in dealing with the discharge of the mortgage. Once I told my former lender of the error they used the CHAPS system to rapidly refund the money at no cost to me. I could have cancelled the DD but would I be breaking their terms and conditions by doing so?
J_B.

AndrewSmith

You would have been breaking no terms and conditions by cancelling the Direct Debit once completion of the new mortgage had taken place as you are then no longer a customer of theirs.

Also the redemption amount paid to them at completion will include outstanding interest up to that point.

Glad it was resolved quickly though.

Andy