Final mortgage payment - bank took too much!

Mog_X

Our final payment on the mortgage went through on 16th April. About a month before this I contacted the bank (Sainsburys) and asked what needs to happen now (we've never paid off a mortgage before!). I could see that there was about £350 left to pay (standard payment was just over £1000). They said that the balance would be taken on the last payment and they would contact us about two weeks later to sort out deeds etc.

On the 16th April we found they took the full £1000 out - not a pleasant surprise as we hadn't put that amount into the account, making us overdrawn on a couple of other standing orders

Contacted them the next day and they said that they would repay within 10 working days - still nothing by last Friday so rang them again - said that they would 'look into it'.

We are cancelling the direct debit as we don't trust them to do the same thing on 16th May, but are they in their rights to take more than they are entitled to?

andy.m_2

exit fees?
Completion fees?

It will be in the small print.

ACG

Sainsburys have a bank? Who knew!

No theyre not within their rights to take more than they are entitled to.
They are entitled to make mistakes though, they would also have to put you back into the position you were in had they not made a mistake.

So that will mean putting the money back in your account, crediting you any costs incurred by making the mistake and if you have any late payment makrers on your credit file - writing you a letter to send to those companies to say it was their fault... so that you can hopefully get the late payment markers removed.

Thrugelmir

Did you make payment by standing order or direct debit?

Mog_X

It's a direct debit, so they could change it (telling us first). I didn't cancel it before the last month as I wouldn't know the exact amount that would need to go out in the last payment.

Sent them a letter this morning.

Sainsbury's (in a joint venture with BOS) used to do mortgages up until around nine years ago, but they didn't farm off existing accounts to other banks.

dunstonh

It is quite normal for the usual monthly payment amount to be made at the end and then if there is a surplus, it will be refunded in the fortnight following.

On the 16th April we found they took the full £1000 out - not a pleasant surprise as we hadn't put that amount into the account, making us overdrawn on a couple of other standing orders

The direct debit scheme requires you to be notified at least 10 days in advance of any change to the amount. Did you get anything in writing to say your normal repayment would be lower?

but are they in their rights to take more than they are entitled to?

I suspect they took what they were entitled to take and had been taking every month and there were assumptions by both you and the person you spoke to on the phone. You assumed it would be lower without getting it in writing that it would be and the person you spoke to assumed your amount owing would match your monthly payment.