Early Repayment penalty fees - Mortages - Legal??

megaman777 · 29 March 2011 at 10:10PM

Firstly, I apologise if this is a topic previously discussed within the website.

That said, this is a topic that is currently high on my list of priorities.

The recession is affecting us all, and what better way to save money than to find a cheaper mortgage deal... however the issue i have is quite simply that in order to switch mortgage provider I am expected to pay an early repayment penalty of £3100.

I only have 12 months remaining on my 5 year fixed term ( I would see the mortgage through, however I need urgent reductions in my monthly ougoings). The mortgage stands at 105,000 so the penalty charge currently works out at 3%.

Ultimately, if I have to switch, it appears I have little choice in paying this, and forking out in the long run.

However, I've tried researching the legality of such fees, and what the likelihood of a succesul recovery of them would be at small claims court.

Does anyone have any views/experience of the above. I'm not holding my breath, but I genuinely feel quite aggrieved at having to line the pockets of the banks by paying what are frankly extortionate and dis-proportionate penalty fees.

Thanks in advance.