Reclaiming Mortgage Exit Fees

john348809

The FSA has issued advice on mortgage exit fees (redemption penalties) these are for present and past customers, and the unfair nature

In summer 2005 I was locked into a Skipton Building Society US Dollar Libor mortgage, the interest rate was spiralling out of control upwards and I was forced to move to a fixed rate. I was charged £9000 for moving!

I have seen other advice on websites stating first write asking for a full breakdown of the charges and ask the company to inform you the exact cost to them of you moving the mortgage, then complain to the FSA. Following this it advises you should start legal action on a similar vein to the bank charges issues.

Anybody any thoughts

millsy1980

You were charged an early repayment charge by the looks of it, these are different to the exit fees you state the FSA has issued advice on. The early repayment charges are clearly shown in both the Key Facts Illustration and the formal Mortgage Offer that you signed to take the mortgage out. You can try and reclaim this £9000, but i can 99.99% guarantee that you won't receive the desired reponse.

john348809

Yes sorry i have got confused.

However i have seen evidence of people trying to reclaims these penalties on the basis the banks are charging £1000's more to the customer than it actually costs them, thus an unfair penalty

MarkyMarkD

Early Repayment Charges (ERCs) are not a penalty for breach of contract. The contracts allow you to exit the arrangement early in exchange for a (usually) pre-determined fee.