early redemption charges.

moneytree.here

My daughter has a mortgage with the Nat West,she having completed a 2 year fixed rate was talked into signing up for another 2 yr fixed rate.This only happened a few days ago and she has yet to pay the new first payment.She now wants to shop around for a better deal but has been told by Nat West she would now have to pay them £850 early redemption charge.Can anyone tell us if this is legal as it seems to us a right rip off.

AndrewSmith

If she has signed agreement to it and has actually been transferred onto the new rate then yes she will have to pay the ERC.

Tony_Soprano

Isnt there usually a cooling off period allowed?

UK007BullDog

I dont think so as it is not a completely new contract but an ongoing thing. Anyway they have her over a barrel.

But dont be too gloomy about it:

It might have worked in her favour though. The rates have gone up today and she has gotten hold of a rate before the rise kicked in at all lenders. She also saved herself the cost of solicitor and surveyor, booking fees, exit fees......

Robert_Sterling

I think that a better time to look around for a better deal is during the three or more months before the existing agreement ends and certainly not after you have already signed up for a further two year deal.