ED123 Mortgage exit fee success

[Ed123]

Sucessfully reclaimed £245 of Mortgage Redemption Administration Fee from mortgage company in less than a month and three letters....

 

1) In July 2005 was charged £295 for transferring mortgage from original company to a different one at end of fixed rate period. We queried it at the time but were told it would be deducted. It was still cheaper to switch anyway.

 

2) In December 2006 found three useful mortgage redeption charge articles at Consumeractiongroup.co.uk:

Remortgaging guide| Remortgage | Remortgage UK | Mortgage | 100% Mortgage - MSN Money UK - The scandal of mortgage exit fees

BBC NEWS | Business | Mortgage exit fees under spotlight

Capital Letters | ZZZ Front | Guardian Unlimited Money

 

3) Using info from the three websites above sent this letter (registered post) to the Customer Services Department of the Mortgage Company at end of December 2006:

"...

This letter is to request the repayment to us of £295 we were charged for redemption administration when we transferred our mortgage from XXXXX to XXXXX in July 2005. We questioned the validity of this charge at the time of redemption and were told that the mortgage would not be redeemed without payment of this charge and that this charge would be taken automatically by Direct Debit from our bank account. It has since come to our attention that this charge was in breach of the Unfair Terms in Consumer Contracts Regulations 1999.

The Unfair Terms in Consumer Contracts Regulations 1999 states:

"A contractual term which has not been individually negotiated shall be regarded as unfair if it causes a significant imbalance in the parties' rights and obligations to the detriment of the consumer."

In our case the redemption administration charge had increased dramatically in the two years since we agreed the original mortgage with XXXXXX, plus the redemption administration charge of £295 did not reflect the very minor administrative costs associated with redeeming the mortgage.

Please do not hesitate to contact me if you require any further information. If we do not hear from XXXXXX by 31 January 2007 we will pass this complaint to the Financial Ombudsman Service and the Office of Fair Trading.

..."

 

4) Recieved a reply back within the week offering a £70 refund and listing all the labour involved in administration and saying the charge was 'in line' with the companies policies. Replied quoting the Consumer Contracts Regulations 1999 again and asking for £245 as £50 (not £295) was a reasonable charge for the administration involved in redeeming the mortgage etc. Sent it by registered post and gave another month to reply on pain of the Financial Ombudsman Service and the Office of Fair Trading being contacted.

 

5) Recieved an agreement form for a refund of £245 within the week although the wording was a bit vague (just said it was reducing the charge to £50 not that they were refunding £245) so hand modified the agreement form to make expectation of refund of £245 clear.

 

6) Cheque for £245 arrived in the post today. Ace, will donate £25 to Consumer Action Group as thanks for its help.

 

 

Good luck and thanks again to Consumeractiongroup.co.uk

 

Ed123

[mrsfoot]

Well done Ed123. That is good news

[biffa1965]

well done...the buggers know theyre in the wrong !

[Les Gunn]

Great stuff - we're on the warpath and they know it!!