Early Repayment Charge on mortgage

s._torkington

Hello,

We took out mortgage out years ago 2004, and we have just received compensation with the company we took the mortgage out with. We have been given a cheque for compensation which was out of the blue after all these years. Letter states we are refunding the early repayment charge you incurred when you repaid your outstanding mortgage balance early. Now were just wondering as we paid this fee at the time in 2004 this fee was put onto the new mortgage we took out, would we be entitled to anymore money as this got added onto new mortgage which we have been repaying for years.

AnotherJoe

I'd say no because it was your choice to add it to the new mortgage.

s._torkington

It looks like though they were not supposed to of charged us this amount in the first place as we have got it refunded, so we would not of had this amount added onto our mortgage if that was the case.

Lemonsqueezer78

If this was paid as some kind of redress, did the payment not already include some kind of "interest" component? Are you saying they have refunded the charges only - and nothing at all additional?

AnotherJoe

s._torkington wrote: »

It looks like though they were not supposed to of charged us this amount in the first place as we have got it refunded, so we would not of had this amount added onto our mortgage if that was the case.

So make that claim in a response to them.
"Thank you for your refund of £5,220 for invalid ERC. However, all you have done is refund the ERC and not the £1,762 in interest I calculate we have paid on that sum since 2004" (I made those numbers up obviously, you'll have to do the maths). Please confirm you will be paying this sum.

s._torkington

Thank you.. were thinking along them them lines but were not too sure. We will proceed as with what you have said. Many thanks

AnotherJoe

Ps should they come back and say "you didn't need to add that to the mortage" , (as I originally said and I now think I was wrong), you can point out that even if that's the case, you missed out on interest you could have been earning on that money in the intervening time, which comes to the same thing or even better since IiRC the official government figure on late payments is interest at 8% so you could claim that since 2004.