A&L Redemption fee - why higher than the rest?

Mike_Holden

Hi all, first post so apologies if this rambles on more than necessary. I've been a subscriber to the site for a while now, and as a result have successfully obtained many a refund / compensation payment from various institutions.

My posting concerns the A&L mortgage redemption fee, and why it is sooo much higher than competing banks? I've read posts on here concerning this, and many refer to the fact that the charge has gone through the roof unilaterally since some took out a mortgage.

We know the charge is actually an 'incentive' to punish us for changing lenders, and yes, it's in the documentation. But many of us on this forum have signed up for bank accounts knowing the penalty charges listed, but successfully challenged them later under the premise that charges are out of proportion to costs. My argument is the same for the redemption fee - surely A&L don't have 'costs' which are so much more than other lenders, to justify this fee?

I should say at this point (i) I took out the mortgage knowing (though unhappy) about the fee, and (ii) it's a few months until my reduced rate expires, so I wouldn't consider moving before then. I'm just wondering if we, as a forum, think there's mileage in challenging this rip-off, even considering the fact it's listed in the T&Cs?

Noz

through reading past posters success stories, your best bet is to appeal to the lender if they have increased the fee since you took out the mortgage, and they may refund the differene - however it looks like you were fully aware of the fee and its cost, so there mightn't be an avenue open to you

Mike_Holden

Thanks, yeah, that's kind of what I was thinking.

I must confess to seeing the redemption fee on the documentation sent through shortly after taking out the mortgage (funny how they make it clear after you've signed, but are pretty reluctant to mention it beforehand...) but at the time I just thought all loan companies applied a redeption fee, rip-off though this is, and that they were all approximately the same.

As I said, I'll be a while before I change my mortgage anyway, but when I come to be changing I'm definitely going to be requesting a reduction of this fee, based upon the discrepancy between the cost of redeeming a mortgage and the fee charged. I'll obviously keep the forum posted on any progress!