Post redemption interest

medders6868

Having recently moved house we paid off existing mortgage and moved to a new lender. We waited until the early redemtion period had finished and then moved. Our lawyer received redemption statement from lender for the period, upto and including 31 March this year. We eventually managed to complete on the 2 March and the mortgage was repaid.

I then asked the lender for the interest from 3 March to 31 March to be repaid, approx £800.

Various correspondence has been written between us and today we received their "final" view which was that "we are unable to refund the interest charged as it was included as a term in the original contract at 19.2."

My previous letter included this comment

"The FSA’s recent guidance on best practice states that “we think a firm is likely to be in breach of Principal 6 of our Principals for Business, if it relies on an unfair term in practice when it ought to know it was unfair” which to us this clearly is. Your organisation is making excessive profit and effectively charging excessive interest which, in turn, is an unfair term. It also states that “a term is likely to be unfair unless it is proportionate to the costs incurred by the lender” which, again, this clearly isn’t.

Obviously they disagree.

I was planning on going to the Ombudsman and then to court if need be unless someone can tell me that I have no case.

Any views appreciated.

Many thanks

Medders

silvercar

depends whether interest is paid in advance or arrears, also what does condition 19.2 say.

If they won't budge, I think the correct procedure is to exhaust their internal complaints procedure then get a letter of deadlock and complain to the FOS. They will adjudicate and charge the lender a few hundred for the privelage.

medders6868

had to go to Financial Ombudsman but have now received cheque for full amount plus £50 for the inconvenience! Glad I didnt give up.