NEW Mortgage Exit Fees Discussion

dunstonh

Have I got a case if I were to take this further, or would I be wasting my time??

Sounds like they are responding to a leetter from you saying the fees were not justified. In which case, their response is correct. There is no question over whether they are justified or not. Its only if the increases from when you started the mortgage were unreasonable. Increases are allowed and an increase from £100 to £145 is probably not unreasonable when you consider many lenders were going to £250 or £299.

MarkyMarkD

Kidtechnical

No. Not at all.

Exit fees are 100% totally legal.

But the FSA ruling said that exit fees couldn't be increased without good cause from the amount agreed up front.

As I understand it, your contract said you had to be a mortgage administration fee - a form of exit fee - of £225 and that's what they've charged you. So they've done nothing wrong.

kidtechnical

Thanks Markymark:)

Bykerlass

I have just changed mortgage lender from Woolwich to Abbey. In my original contract it says a fee of £275 is payable as an exit fee. I have paid this and was wondering whether it is worth writing to them stating that I believe their fees are a bit steep for the work invoved in transferring the paperwork to new lender.
Is there any point in trying this or am I wasting my time? I do understand that it was in the aggrement but just wondered if there was any way it may be reduced.
Thanks in advance

dunstonh

I have paid this and was wondering whether it is worth writing to them stating that I believe their fees are a bit steep for the work invoved in transferring the paperwork to new lender.

Doesnt matter what you think. There is a defined process here. If you agreed the mortgage with a £275 fee then the lender is entitled to charge you £275. If the fee when you took the mortgage out was £150. Then you can ask them to refund the difference.

bryanwood44

I recently decided to pay off a large amount from my morgage. I rang up the lender to find out the charge before paying it off. They told me a low sum over the phone.

About a week later I received confirmation that some of the morgage had been paid off, but the lender had made a much larger charge than I had been told they would make.

I complained to the lender, they told me the person over the phone had made a mistake in thier original estimation to me, and that the larger charge they had made still stood.

If I had known it was a bigger Early repayment charge, in the first place I would not have paid off part of the morgage, but waited.

I am not sure on how to procede further in oder to claim the money back, which I have lost due to thier admitted error.

Does anyone have advice?

mlucyminx

Hi i dont know if i am posting this in the right bit. I have had 3 secured loans in the past 5 years. all paid off early as i reconsolodated or re-mortgaged. On one of the final statements it is listed
(Early settlement) regulations 2004 £395.00
Redemption Administration Fee £102.00
Collection Costs £705.00

Are any of these fees reclaimable.
It seems an awful lot of money just to pay a loan up early.

Really confused as to what can be reclaimed

dainowel

Is it only me but I feel that the mortgage industry has been deregulated for years and the proof of this is that lenders have been able to introduce fees that in almost any other business environment would have been vigorously resisted.
In this country at any rate banks and lenders always have the upper hand and charge what they please.

I have been charged tens of thousands by lenders for the privilege of terminating a mortgage agreement and the fact is there is no escaping the practice all lenders now include early rtedemption clauses that are punitive to say the least.

There are all sorts of reasons why mortgages are terminated early: divorce, separation, death or sheer economics to name but a few.

I havent asked the OFT for an opinion but I wonder if anyone out there has taken the trouble to find out what the law is on this?

MarkyMarkD

bryanwood44 wrote: »

I recently decided to pay off a large amount from my morgage. I rang up the lender to find out the charge before paying it off. They told me a low sum over the phone.

About a week later I received confirmation that some of the morgage had been paid off, but the lender had made a much larger charge than I had been told they would make.

I complained to the lender, they told me the person over the phone had made a mistake in thier original estimation to me, and that the larger charge they had made still stood.

If I had known it was a bigger Early repayment charge, in the first place I would not have paid off part of the morgage, but waited.

I am not sure on how to procede further in oder to claim the money back, which I have lost due to thier admitted error.

Does anyone have advice?

It's not relevant to this thread, as you are talking about an ERC, not an MEAF, but here's the answer anyway.

You need to ask them to refund you the capital payment, and then credit the ERC back to your account, on the basis that they misled you.

They aren't going to simply let you off the ERC. So ask for the capital payment to be unwound.

MarkyMarkD

mlucyminx wrote: »

Hi i dont know if i am posting this in the right bit. I have had 3 secured loans in the past 5 years. all paid off early as i reconsolodated or re-mortgaged. On one of the final statements it is listed
(Early settlement) regulations 2004 £395.00
Redemption Administration Fee £102.00
Collection Costs £705.00

Are any of these fees reclaimable.
It seems an awful lot of money just to pay a loan up early.

Really confused as to what can be reclaimed

Secured loans were not normally regulated by the FSA and hence the FSA's MEAF ruling doesn't normally apply to them.

In any case, collection costs and early settlement charges wouldn't be covered. The only element where you might have a shout is the RAF (effectively the MEAF) but I refer you to my comments above re regulation or lack thereof.