Advice please on mortgage redemption fee

Babooshki

My husband & I are buying a house and transferring the mortgage that we have on our flat as part payment on the new property (and getting a new mortgage to cover the rest with the same lender). Barclays-Woolwich, as well as adding the unbelievable 'arrangement fee', have also added on a £150 'redemption fee' charge to move the existing mortgage onto a new property. However, I fail to see how this is a redemption charge or an exit fee since we are not ending the mortgage simply transferring it. I have seen articles and a forum discussion on claiming back mortgage fees on here & want to know if we have a case to ask them to deduct this (the costs of moving and stamp duty are crippling as it is ) Any advice and thoughts welcome. Thank you.

_Andy_

Nothing to claim back assuming it was in your original mortgage offer.

Not sure why you feel the arrangement fee was 'unbelievable'.

Babooshki

I'll check the original contract, thanks.

'Unbelievable' = charging nigh-on a grand for shuffling a few bits of paper around. We even had to run our own credit reports for goodness's sake, surely something they should be doing!

Dave_the_Ginger_Cat

You are redeeming the mortgage, as it's a loan linked to your existing property.

They are choosing to allow you to set up another loan of a similar amount on a new property. People can perceive this as moving a loan, but in reality it's redeeming one and taking out a new loan.

This seems completely in line with my knowledge of their Ts&Cs and what you will have signed up for. I'm afraid you need to accept that the cost of moving house is high

holly_hobby

This sounds like a mortgage exit admin fee.

This has been charged because your old mge is to be closed down, ie you are selling the property (or remortgaging to a different lender if being retained and let), on which it is secured. With the new mge on your new home accordingly treated as completely new borrowings.

This is because you can not transfer mortgage borrowings from one property to another, it is always a brand new application (even if the amount of mge requested is the same or even less than that previously held), with full UW on the mge on your new home, being treated as completely new borrowings (which essentially it is).

Your MEAF fee will be detailed in your original mge T&Cs - if noted as anything less than £150, then yes they have to refund any overcharge.

The lender will have perfromed their own CRA and UW checks on you - thats a regulatory requirement.

Hope this helps

Holly

_Andy_

"'Unbelievable' = charging nigh-on a grand for shuffling a few bits of paper around. We even had to run our own credit reports for goodness's sake, surely something they should be doing!"

If you thought it was high, why did you not take a fee-free product?

kingstreet

Ignoring the exit fee, which has already been dealt with, the product fee you are mentioning is part of the product pricing. If there was no fee, the rate would be higher.

Lenders often have a choice of products for each loan to value band, a lower rate with a fee and a higher rate with a lower, or no, fee. It depends on your circumstances, which is best for you.

Thrugelmir

Babooshki wrote: »

We even had to run our own credit reports for goodness's sake, surely something they should be doing!

You didn't have to. As it's not what the lender uses to vet you.