Mortgage Company Expenses Charges

Beamish_Boy

Almost 2 years ago I took out a 2-year fixed rate mortgage at 3.89% with Alliance and Leicester. This special rate period is coming to an end on June 30th and I am looking for a better deal. (Incidentially - I have located a 1 year, fully flexible, no fees, no costs, discounted rate of 5.24% with "The One Account" from B.o.S.)

I have been advised that an administration charge can be levied against me by A&L for switching mortgages. This comes under the heading of "Expenses" in the conditions of my current mortgage. The information at the time the mortgage commenced did not set out the level of charge but does not need to be payed in full if I can demonstrate that the charge is unreasonable or unjustified against actual costs. I am informed that the charge for switching to another mortgage provider will be £395. (This is not for early repayment of the fixed rate mortgage) I understand that A&L charge one of the highest rates and has jumped from £250 in Jan 2004. Other mortgage providers have set their charges for this service as low as £75.

I am interested in any advice for challenging the level of charges from A&L. I guess that gaining an understanding the work to be undertaken by A&L in supporting my move to another mortgage provider would give some indication of the actual costs and work incurred by them.

If anyone has challenged mortgage expense charges successfully I would be keen to hear from you.

I would also be keen to get sourced, accurate figures for the actual costs to a mortgage provider in supporting the moving of a mortgage to another provider.

Hope someone can help.

Beamish Boy

crazyhazy

I work for a mortgage lender and I would guess the charge is basically a deeds release fee, an admin fee for keeping your deeds safe and returning them to you. It is very expensive, currently the lenders within our group charge 195 (which has also changed from 99). I wouldn't think there was any way round it, except maybe to complain enough and they might waive it. One other small thing the one account is actually part of RBS.

Fairdo_2

The fees can be changed at any point and they should have shown detail of the types of fees payable on your offer (although they would undoubtably be higher now than when quoted.

As Crazyhazy stated, one of the fees is for Deeds release, another quoted fee tends to be a sealing fee and they often charge a Bank Telegraphic Transfer Fee for the potential receipt of funds electronically.

I think my understanding is that A&L are one of the more expensive lenders at exit for Admin fees, but they are within their rights to charge these fees and choose their own levies on this. This is because they would have detailed potential fees in their offer. However, under their new regulated regime, lenders now have to make these types of exit (as well as entry) fees clearer in their illustrations and offer documents.