Alliance and Leicester took me to the cleaners!

mduap

In 2000 I had a mortgage with alliance and Leicester when I decided to buy a building plot. At the time they were unwilling to help me build the house with a self build mortgage because they didn't do them. I then had to switch my mortgage to Nationwide. I was at this time halfway through a fixed rate term with Alliance and Leicester and this is what they charged me for changing mortgages:
£67,475.72 Balance
£2,878.84 Interest
£1432.58 Repayment fee
£75 Deeds production fee
£75 Redemption Charge

Is there anyway that I could claim all or some of the money back(I don't mean the balance!)? After all I wanted to stay keep my mortgage with them but they could not offer me a self-build option.
Is it wort writing them a letter asking for the money back or am I wasting my time? Please help. Thanks!

GeorgieW

I think it's ALWAYS worth a try. It won't take long to draft a letter, you seem to have all the relevant numbers at hand at least. The problem is you will have signed up to those terms but they hopefully might come to some arrangement with you, goodwill & everything (it'll stop you slating them on MSE anyway!). I wouldn't expect to get it all back though, decide on what you'd be happy with & aim for that.

I think simply point out the facts and ask, if you don't get anywhere lay it on more. If you're serious, you could mention court? With MSE & Watchdog on the bank backs about charges, mis-selling loans & insurance, I'm sure they have enough to deal with!

I'm not sure if the 6 year rule (I think it's 6?) would apply to this i.e. you can only claim within that time. I'm sure other people will be of more help but that's my two pennies worth!

Cannon_Fodder

You are the one who changed your mind. Did you not ASK what the fees were before going ahead and cancelling? If so, why not hang on for the couple of years or so, if the charges were so unpalatable...

It was YOUR decision to exit from a contract that you had freely entered into...

dunstonh

Nothing in those charges seems unfair so its highly unlikely to get anywhere.

cattie

A £75 redemption fee sounds incredibily reasonable considering what A&L currently charge. You've not been ripped off by them by any stretch of the imagination & as already mentioned, they only charged the penalty interest fee as you wanted out of the deal early & would have agreed to this when you signed for the mortgage. This is standard for the majority of mortgages unless you specifically choose one with no exit penalties. Usually these don't offer such favorable interest rates.

It's just a pity you didn't check before taking out the mortgage if they also offered finance for self builds.

MortgageMamma

mduap wrote:

In 2000 I had a mortgage with alliance and Leicester when I decided to buy a building plot. At the time they were unwilling to help me build the house with a self build mortgage because they didn't do them. I then had to switch my mortgage to Nationwide. I was at this time halfway through a fixed rate term with Alliance and Leicester and this is what they charged me for changing mortgages:
£67,475.72 Balance
£2,878.84 Interest
£1432.58 Repayment fee
£75 Deeds production fee
£75 Redemption Charge

Is there anyway that I could claim all or some of the money back(I don't mean the balance!)? After all I wanted to stay keep my mortgage with them but they could not offer me a self-build option.
Is it wort writing them a letter asking for the money back or am I wasting my time? Please help. Thanks!

Two things here.

1 - you decided to buy the building plot, you didnt have to do that
2 - They could not help you with further lending on a self build as that is something they did not do.

Whats unfair about that? Why should the lender give you back some of those early repayment charges you incurred for withdrawing from a fixed term contract? If you had a mobile phone contract at a certain price for 18 months, and then tried to give the phone back to the provide and cancel the airtime rental after 5 months, what do you think the provider would do? Thats, right, they would charge you the line rental for the remainder of the contract. Which is what the lender is doing, if they arnt going to bank anymore of your mortgage payments on which they earn money, they are going to charge you for it. Thats is what a fixed term contract is about.