UNFAIR early repayment charge

sazandy25

We are currently with Barclays direct, in a fixed deal until 01 October 2014, when we are remortgaging with Skipton. (for a better rate)

Skipton were only willing to lend us £70250 and our current redemption figure was £73822.56, so I rang up Barclays and explained that I wanted to make an overpayment to reduce the amount outstanding, the bloke on the phone said not a problem, and that by his calculations we could repay £8365 without incurring any early payment charges. And that the best way to do it was to do it via online banking, as we have a barclays account.

So Tuesday I make a one off Payment from our current account to the Mortgage account. Check my mortgage account today and the payment has been taken off but an early repayment charge of 1495 has been added to mortgage balance.

How can they do this?? :mad::mad::mad:

The bloke on the phone explained I could pay more than I've paid without incurring any charges.

I unable to contact them until tomorrow as the call centre is shut, but believe me they will be getting both barrels from me tomorrow. :mad::mad::mad::mad:

amnblog

That figure is far too high for an early redemption penalty on a repayment of £8,365.

There is an error somewhere on the system which they will no doubt resolve for you.

sazandy25

sorry didn't make it clear, we only made an overpayment of £3575, as that's all we had and it would reduce it enough to be below the amount Skipton are going to lend us.

Really annoyed, I wanted to make payment over the phone, but the bloke said it would be easier to do it online.

So you think its a mistake and it can be rectified?

amnblog

I am confident of it

sazandy25

ok thanks for your help, feeling slightly better now only 1 :mad:

sinizterguy

Of course it's a mistake. The early repayment charge cannot be near enough half of what you have paid.

dunstonh

ERCs are typically no more than 1% of every year. (generalisation but ball park. i.e. 5 years to go would be 5%). Your figure is way too high for £3575 overpayment.

sazandy25

Thanks for all replys, will ring barclays tomorrow and let you know how it goes.

Fingers crossed

Thrugelmir

sazandy25 wrote: »

I unable to contact them until tomorrow as the call centre is shut, but believe me they will be getting both barrels from me tomorrow. :mad::mad::mad::mad:

What does your mortgage paperwork say?

plunt

unless you have already made tons of over-payments during the year, then there is potential they will charge you the ERC on the entire over-repayment amount. but from my eyes it definitely looks like a mistake!

sazandy25

Well, I rung Barclays, I explained everything & made them aware that they ADVISED me that I would not be charged any Early repayment Charges and that I was unhappy.
She looked at our account and could see that I had spoken to someone on Monday and what he had told me.
She said as they had ADVISED me that I would not be charged anything they would HAVE to refund the charge.

I had the feeling that, if they hadn't ADVISED me about the amount I could overpay I wouldn't of a leg to stand on.

Thanks again for all the advice, just so glad I rang to check before I just paid it.