NEW Mortgage Exit Fees Discussion

ernie-money

Quote from Martins article:
The actual administration cost to a mortgage lender of closing down a mortgage isn't thought to be much more than £50 so it's arguable that you needn't pay more than £50, regardless of what your contract says. Therefore writing to your lender, asking it to justify the charges with a full breakdown, and if it refuses asking for a full refund, can work.

Further down in the article it says that lenders have until July this year to justify their charges - this makes me wonder if I'd be better holding off claiming until after July? Can they charge what they like until then?

I called the Stroud & Swindon, with whom we took out a mortgage in approx 2000 and remortgaged from in 2005. We were charged £125 MEAF, but I haven't got the details of what we were actually quoted originally when we took out the mortgage. When I rang up they said that according to the FSA they are allowed to charge anything up to £115 and I could therefore have £10 back. I asked where this figure of £115 came from and she said that is what the FSA has stipulated.

Have I been given the correct information here please?

Thanks to all you knowledgeable people who make this site such a godsend!:money:

Cavs_2

My husband contacted A&L to query the MEAF he had on a previous mortgage. They waffled on about the complaint needing to go to Customer Services and that it would take approx 2 weeks to process. Are these delay tactics? I spoke to the C&G 10 mins previous to his call, and within 5 mins they said a cheque for £100+ would be in the post. Has anyone else had this experience with A&L?

MarkyMarkD

ernie-money wrote: »

Quote from Martins article:
The actual administration cost to a mortgage lender of closing down a mortgage isn't thought to be much more than £50 so it's arguable that you needn't pay more than £50, regardless of what your contract says. Therefore writing to your lender, asking it to justify the charges with a full breakdown, and if it refuses asking for a full refund, can work.

Further down in the article it says that lenders have until July this year to justify their charges - this makes me wonder if I'd be better holding off claiming until after July? Can they charge what they like until then?

I called the Stroud & Swindon, with whom we took out a mortgage in approx 2000 and remortgaged from in 2005. We were charged £125 MEAF, but I haven't got the details of what we were actually quoted originally when we took out the mortgage. When I rang up they said that according to the FSA they are allowed to charge anything up to £115 and I could therefore have £10 back. I asked where this figure of £115 came from and she said that is what the FSA has stipulated.

Have I been given the correct information here please?

Thanks to all you knowledgeable people who make this site such a godsend!:money:

I don't agree with Martin's original article regarding this point. The FSA's ruling clearly states that lenders can charge what they like, as long as they state it up front.

Lenders had to tell the FSA by the end of February 2007 how they were going to deal with both current and former customers. The July 2007 deadline is not very significant - it represents the date from which newly redeeming customers must be charged the "correct" amount. Up until that point, they can be charged the "wrong" amount but they'll still have the right to claim a rebate. Most lenders are already charging the "correct" amount.

There's no point at all in delaying a claim until July or August; neither is there any point in expecting to get more back than a refund back to the amount you originally agreed to. And nor is there any moral case for getting more.

The costs are irrelevant. There is nothing wrong in lenders making a profit on MEAFs, or any other up-front-disclosed aspect of mortgage fees such as arrangement fees, valuation fees or product switch fees. They are all part of what you agree to when you take out a mortgage.

wildcat1

Can I claim some part of arrangement fees? I took out a mortgage with Northern Rock and paid £250 arrangement fee. I then moved house a year later and although I stayed with NR, because I re-mortgaged with them they again charged me an arrangement fee of £250.

dad_researcher

Hi,

I apologise in advance if I am repeating a question already asked, but can I just clarify, what I think is right, and that I havent been charged and therefore cannot reclaim MEAF charges if I have remortgaged but stayed with the same lender?

Also I cannot claim arrangement or product fees payable for the new mortgages when switiching.

Thanks

MarkyMarkD

Wildcat1 and dad_researcher

Arrangement fees are an optional fee when you choose a mortgage. They are not refundable under any circumstances - they are a condition of getting that particular mortgage product with its rate and other terms.

But, wildcat1, you will have paid NR an MEAF when your first mortgage was redeemed, and that may have been increased over what you originally agreed, so a partial refund may be due.

Dad_researcher, I'm not sure whether you are saying that you've switched products but remained in the same house and with the same lender - in which case, you've done a product switch and not a remortgage at all. If this is the case, you won't have paid an MEAF so no refund of any sort is due.

mayb_2

MarkyMarkD forgive me I know you do not like people posting the same thing in two different threads, but I posted it in the Mortgage exit fees successes and failures in response to something that came up there and then decided it belonged here instead. As it could belong in either I have posted it twice.

You may be able to answer this one for me. As I understand/remember it (I am not as young as I was so could be faulty here) there was some ruling that if a Mortgage Lender had a product offering better terms than existing customers were enjoying - they had to offer that product to existing customers. Stop me if I am wrong but should that not mean that they cannot penalise the customer if they chose to change product any more than if the customer changed mortgage to go to another company altogether - in other words MEAFs. Otherwise they are not really offering the existing customer the same opportunity as new customers are they. They cannot have to carry out the same amount of work as with a new customer so it cannot cost them that much to make a switch. I know you are going to say they can charge what they like and the customer does not have to switch - but that is flying in the face of the original ruling isn't it? Would you not expect them to offer a deal to the existing customer rather than risk losing that customer to another company. It does appear to be a bit of opportunistic money making. as they could lose the business altogether and only make the MEAFs anyway.

crispeater

omg im so confused.

please forgive but im a simpleton

i sold my flat about 2 maybe 3 years ago and didnt take on another mortgage i have no idea if i was charged anything for paying off my mortgage early.
so, how do i go about finding out and would i be able to claim it back? there are just soooo many pages here i cant read them all plus it would confuse me even more.

Frank.lui

I made a complaint to Halifax regarding their Mortgage Exit Administration Fee they charged me in 2004 (£100). I got a response from them saying their charge was explained in the information booklet they sent to me with Mortage offer. As a 'good will gesture' they now would like to offer £25 refund as a final settlement. I did not keep the booklet.

I looked at web and it seems a reasonable charge is around £50. So Should I ask for more or accept this offer?

mayb_2

I think there are always MEAFs to pay when you finish the mortgage crispeater - as that is what they are Mortgage Exit Administration Fees. You can claim if you were charged more than the amount agreed at the start of your mortgage. Why not send the template letter available on the main site to your mortgage company and see what happens.