Penalty on redemption

AW369

I took a 10 year fixed rate mortgage in 2007 at 5.39% with Woolwich/Barclays. Now 6 years on and due to the interest rates being very low I am looking to change - the issue is that the penalty for moving away from this mortgage is 6% of the outstanding balance which seems excessive to me. I have seen the posts re reclaiming fee's on changing a mortgage but I have not seen any info relating the above type of penalty. I would like to challenge the lender on this but I am not sure if I have any chance of being successful. For obvious reasons my aim is to reduce the interest payable on my mortgage payments.
I wonder f anyone can help it would be greatly appreciated.

StuC75

It was a charge you were aware of when taking out the mortgage. Early repayment fees are valid charges, since it is a charge for the priviledge of the rate that you took out..

Its only because rates have come down that you are looking to get out of the deal.. So nothing unfair there, you just need to find a deal that makes it financially worthwhile paying the 6% upfront to save over the next couple of years...

dunstonh

I have seen the posts re reclaiming fee's on changing a mortgage but I have not seen any info relating the above type of penalty.

That is because there isnt any.

I would like to challenge the lender on this but I am not sure if I have any chance of being successful.

The fee is considered fair and lawful and no-one has successfully challenged them. They exist for logical reasons and are quite fair and reasonable. A 2007 contract would have no chance.

Thrugelmir

As you are effectively locked in. Make overpayments to the mortgage account if you can afford to do so.