High exit fees - should I complain

lisyloo

A&L will let you switch to any "new customer" product on the same terms as a new customer, except that there will be a switch fee of £250.

This would include any "product fee" that a new customer has to pay.

As this is less than the costs you would incur remortgaging, it's not a bad option to consider.

I don't agree it's less than remortgaging (although it depends on which product you chose of course).
The product I would want has a product fee of £395 which makes total fees of £645.
I believe I can do better than this on both rates and fees, although I am going to give A&L "retentions" department a chance to give me a better deal before making a final decision.

My current favourite is EGG which is 4.24% for 6 months and will only costs me £25 (plus £295 to A&L) although I keep my eyes open.

stockportsaver

To anyone who has been charged £295 "admin fee" when closing their mortgage with A and L.

Do not take heed of some of the self proclaimed financial experts who have posted on this thread, trying to justify the charge.

I have just been refunded £195 after sending 2 x letters about the unfair charge, and asking for a breakdown of their costs. I believe I could have pushed further, but consider £140 a reasonable charge, one which is in line with the rest of the industry.

So,don't be disuaded by the negative comments from one or two contributors, and go send them a letter...you've nothing to lose !

Daniel_B

stockportsaver wrote:

To anyone who has been charged £295 "admin fee" when closing their mortgage with A and L.

I have just been refunded £195 after sending 2 x letters about the unfair charge, and asking for a breakdown of their costs. I believe I could have pushed further, but consider £140 a reasonable charge

If the admin fee was £295 (in your case?) and you were refunded £195, then that would make your bill £100, not £140, or were you just giving an example price?

Dan

mrcow

stockportsaver wrote:

So,don't be disuaded by the negative comments from one or two contributors, and go send them a letter...you've nothing to lose !

Well done you :T

It's a stealth charge that they use to penalise exisitng customers to help finance deals for new customers (at least that's what C&G told me on the phone).

Enjoy your refund!

what-a-save

Decided to pay our mortgage off early, only to face an admin charge of £295.00. Wrote a letter to say i felt the fee was excessive etc. Received a reply offering a revised fee of £225, off went another letter stating i still felt it was an excessive fee. Reply recieved from A&L with a revised fee of £140. I then phoned the mortgage customer relations people at Narborough, spoke to a very pleasant lady who in turn spoke with her manager. Result - fee waived.
Mortgage paid off eight years early and NO admin fee either.
Today me and the wife are well happy.:j
So go for it - after all they have made thousands in interest over the years out of yours truly!

mrcow

what-a-save wrote:

I then phoned the mortgage customer relations people at Narborough, spoke to a very pleasant lady who in turn spoke with her manager. Result - fee waived.

Excellent :T Always worth a haggle!

MarkyMarkD

what-a-save wrote:

So go for it - after all they have made thousands in interest over the years out of yours truly!

No, they haven't. You've paid them thousands in interest; they've had to pay thousands in interest to fund your mortgage. Don't confuse your interest payments with their profit.

what-a-save

MarkyMarkD wrote:

No, they haven't. You've paid them thousands in interest; they've had to pay thousands in interest to fund your mortgage. Don't confuse your interest payments with their profit.

I take your point. However, 'A&L Chief executive' - Remuneration for year ending 31/12/05 = Salary £619000+Bonus payment £575000+ Other bonus £23000= Total £1,217000.
I am sure it was well earned.
So i think they can cope with £295.00 out of their profit.

regularsaver1

but every lender charges a fee like this now

if you leave A&L and pay £295 now - and then go to say Halifax, they will charge £175 to leave later

the chief executive can keep their job - wouldn't do it - their pay has nothing to do with this fee if people choose to leave

MarkyMarkD

Thanks for taking my point, what-a-save. What I meant was that the profit on a mortgage is next to nothing - indeed, most of the "best buy" mortgages are loss making (on a pure interest rate basis) during their fixed or discounted period. The only money the lenders make is from:

(1) people who stay after the fixed or discounted period - like hardly anyone on MSE
(2) the up-front and end of mortgage fees.

I personally think there's nothing wrong with a £295 (or £500, or £1,000, for that matter) end of mortgage fee (as long as it's fixed and disclosed up front) - what matters is the total cost to the borrower. It's actually far fairer, IMHO, to have NO fees up front, and to charge ALL of the fees when people leave the lender - that's rewarding loyalty as you don't pay until you leave. Even fairer, if the end of mortgage fees decrease the longer you stay for.

But then again, nobody's going to listen to my dream mortgage ideas!