Thread: Redemption Administration Charge

Hi,

First post claiming stuff so I hope this is in the right place, otherwise abuse away.

Just moved mortgages from A&L to another one at the end of our fixed rate term and noticed this entry on our costs of £295 for a "Redemption Administration Charge". I read a little here and elsewhere that this is one of those unfair charges so I have decided to claim it (or all except a fair representation of A&L's costs) back.

First stage was tonight's call to A&L Helpdesk to check we are all done. After that we start stage 1.

Me : "And I noticed this entry called 'Redemption Administration Charge', whats that for ?"

A&L : "Thats because you are closing the account xx years early."

Me : "Yes, but what does that actually pay for ?"

A&L : "Closing this account."

Me : "OK, it says Administration Charge, what Administration is involved."

A&L : "Closing your account, cancelling your direct debit.."

Me : "I find it hard to believe this costs nearly £300 so I would like some back please."

A&L : "OK, I can lodge a complaint for you ?"

So we left it there. "She" is lodging a complaint and I should receive a notification in 7 days and a reply in 28.

I'm happy to wait so we shall see.

I searched earlier and came up with no similar threads on these charges (or more specifically A&L) so we shall see how this one goes.

Advice and/or abuse welcome - I'm an only child...8-)

Similar Threads:

• Redemption Administration Charge
• £100 Administration charge
• 'Administration' Charge
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• Administration charge for banks

good luck

A reply from the Midlands this morning - in fact 2 identical copies arrived at the same time both personally signed too.

Dear T&C

Thank you for your recent telephone call.

A&L first introduced a single administration fee of £195 from 5 January 2004 called the Early Closure Administration Charge and this fee was increased in August 2004 to £295.

Interesting, its called the "Redemption Administration Charge" on my statements.

Having reviewed our records, I can see that your mortgage was advanced after this charge was increased in Augusr 2004. This, together with other service charges, would have been detailed in the leaflet that was included with the Annual mortgage Statements each year since then.

Some review, we used to get monthly statements and not annual ones, never mind I get the idea...

In the circumstances, I do not feel that this has been unfairly applied and, therefore, I cannot agree to refund any part of this to you.

Your complaint will be left open... blah ... fos ... blah ... etc. etc.

I can read this in two ways. One they are just saying no (Sammo would be proud ) or they think I just want the lower charge to apply. Nope I want it all.

So this is what I propose to send back.

Customer person
Group Customer Relations
Alliance & Leicester plc
..

Dear Mr Customer Services Person

Account no: XYZABCDEF

Your Ref : 2222222.

Thank you for the two identical copies of your letter dated the 23rd of June, the contents of which have been noted. I believe that the nature of my complaint has been misunderstood and I hope that this letter will clarify my position.

You have charged us a fee for exiting our mortgage that you claim is to cover your costs for closing the account. To clarify on the statements we have received this is called the “Redemption Administration Charge” and not the “Early Closure Administration Charge” as described in your letter.

The fee charged at £295 is far too high to possibly reflect your true administrative costs. It is unlawful at common law, and under statute and consumer regulations, to impose charges in standard, pre-written contracts without making it clear what the charges are for. Furthermore, the charges must be fair, not penalties.

Unless you can prove that these charges are a fair reflection of your administrative costs, I require full repayment of these charges.

If you do not comply fully within 21 days, I shall begin a claim against you for the full amount, plus interest and costs.

Yours faithfully

T&C

Letter taken from here (hope its OK to link there) except for the 21days bit - I'm going on holiday so they can wait until I get back.

Comments or abuse welcome.

There are various threads about redemption fees some of which went to court and lost. Certainly if the redemption fee is greater than was the stated amount when you took out the mortgage any difference should and usually is repaid. Whilst not saying you cannot take this matter further it would appear you will find it very difficult. Also be careful, some mortgage companies have it written in the mortgage conditions that you have to pay their fees in any court case which could be extensive.

Well, they threw in the towel. I delayed sending the second letter (I forgot and went on holiday) but in less than a week they sent me a cheque for the full amount.