Genesco V Kensington

[ellielou]

You're right Sue.

 

I've decided that with the encouragement I received on here I'm going to do the MCOL on Friday.

 

Thanks for the support everyone & if my claim goes to court please don't desert me lol :grin:

[genesco]

Just a quick update, so far I have recieved 2 of the same letter from kensington asking for 2 lots of seven days to reply to my first letter, and then after I sent out my LBA they sent a letter saying that I will recieve a response in five working days lets see shall we.

 

So Not recieve an explination yet. I only want the break down of my ERC or my money back is that too much to ask.

[ellielou]

It seems that it is Gene. I gave them 3 chances to give me the hard figures how they calulated my ERC - they've come back with nothing worth the paper it's written on. So last Monday (before I'd rec'd their response to my 3rd request) I registered my MCOL for £6,200. I received a reply to my 3rd letter on Saturday which once again was a waste of space. I'm glad I bit the bullet and went for the MCOL, the more I read about it, the more Kensington avoid the question, the more I know they haven't got a leg to stand on.

 

Don't give them any more time - go for the MOCL - everyone on here is behind you

[genesco]

Hi I recievd this letter from kensington today.

 

Sorry it's so long but here's the reply Kensington sent me - any thoughts?

 

Further to all our recent communications, regarding your dealings with Kensington Mortgages, I have now fully investigated the issues raised.

 

I am sorry that you have experienced problems with your mortgage. In your letter, you explained;

 

That you believe the ERC to be an unlawful charge, and as such, you require a breakdown of the costs incurred as a result of redeeming within the first 3 years of the mortgage term.

That if w are unable to supply the above information, you will not hesitate to issue a claim against us for the full amount, including and interest and costs.

 

I have now had the opportunity to review all of the circumstances leading up to your complaint being received in this office, and I hope that by presenting my findings to you, an outcome can be reached which will be of satisfaction to all parties concerned.

 

There are substantial costs involved in originating and administrating mortgages and w seek to recover these costs over the term of the mortgage. For this reason, the minimum loan term we allow is 5 years. Had we been informed at the time of your application that your mortgage was to be repaid within the first 3 years, then we would not have offered the mortgage to you. When borrowers repay their mortgage early, we seek to recover costs by way of the ERC.

 

The ERC represents a genuine pre-estimate of the costs we incur in originating particular products and varies depending on whether a customer takes out a variable rate, fixed rate or discount rate. The type of costs that are incurred by us include the following:

 

Fees payable to intermediaries involved in introducing the loan, which are calculated as a percentage of the loan.

Costs in relation to the funding the mortgage, including and discount or fixed rate, also calculated as a percentage of the loan.

Operational costs.

 

I note for example that with your mortgage you recieved a 2% discount from the variable rate, from completion of the loan until 30 November 2005. which represents a benefit of approx £3200. There were intermediary feesof £4,606.32, which you were informed would be paid upon completion of your loan.

 

when other costs of securitising the loan and the overheads associated in running a commercial organisation such as the costs of staff, premises and advertising are also included, the total costs incurred by us are certainly reasonable when compared to the ERC paid by you of £9,624.78. Therefore I fully believe that the way by which we calculate an ERC, as a percentage of the amount repaid, is a reflection of true costs and is fair and reasonable.

 

We have also provided details of our ERCs to both the OFT and FSA and they have not stated that they are excessive or disproportionately high.

 

I also note that you claim that our ERC is exessive and should be reduced or waived as you believe that it might be contrary to the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCR).

 

We do not agree that the UTCCR does not apply to the ERC as it is part of the price of the mortgage and clearly disclosed in the mortgage offer as such. I do not believe that the ERC is unfair or that it causes a significant imbalance in our respective rights and obligations arising under the mortgage, to the detriment of you. This is based on the facts that there were many other providers of mortgages available to you and you actually entered into the mortgage in full knowledge of the ERC and when it would apply.

 

Even if it was determined that the UTCCR applied, Section 6(1) of UTCCR states that the unfairness of a contractual term should be assessed by taking into account the nature of the goods or services for which the contract was concluded and by referring, at the time of conclusion of the contract, to all the circumstances attending the conclusion of the contract and to all the other terms of the contract. Specifically, and with reference to paragraph 1(e) of Schedule 2 as referred to in Regulation 5(5) of UTCCR, it is denied that the ERC requires you to pay disproportionately high sum in compensation for redeeming a mortgage early.

 

For these reasons, we are not prepared to refund the ERC you incurred on redemption of your mortgage.

 

Given the tone of your latest correspondence, I should inform you that this is an open letter and that it's contents will be shown to the court in ther event of a claim being commenced by you. any proceedings will be vigorously defended.

.

My response is in accordance with stage 4 of our Customer Complaints procedure leaflet, a copy of which is enclosed for your information.

 

If you have any queries regarding my decision, please either contact me on 01756 692312 at the above address or refer to the enclosed leaflet.

 

Please be aware that if we do not hear from you within the next 8 weeks we will consider your complaint closed.

 

Yours sincerely

 

John Bailey

Team Manager

 

Can they close my complaint after 8 weeks.

[genesco]

HERE IS MY RECENT LETTER THEY ARE REFERING TO IN THERE LETTER WHICH THEY WILL USE IN COURT AGAINST ME:

 

 

Kensington Mortgages

1 Providence Place,

Skipton

North Yorkshire

BD23 2HL

United Kingdom

 

DX: 21761 Skipton

 

Direct Line: 0870 556 10 40

 

19 October 2006

 

Letter Before Action

 

Dear Barry Ellershaw

ACCOUNT NUMBER: xxxxx

 

Thank you for your letter dated 6th October 2006. I am disappointed to see that you haven’t given us a full response by now after I have given you the extra 7 days you ask for out of goodwill. So therefore am sending you this letter before action.

 

We are writing to ask you to refund the charges which you have levied from our account in respect of £9629.94 an Early redemption fee. We now understand that such fees are unlawful at Common Law, Statute and recent consumer Regulations.

 

In the case of Castaneda and Others v. Clydebank Engineering and Shipbuilding Co., Ltd. (1904) 12 SLT 498 the House of Lords held that a contractual party can only recover damages for actual or liquidated losses incurred from a breach of contract as oppose to a charge which represents a penalty. This law was confirmed and upheld in Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79. A charge will be held to be a penalty if the sum stipulated for is extravagant and unconscionable in amount in comparison to the greatest loss that could conceivably be proved to have followed from the breach. A penalty clause is void in its entirety and unenforceable.

 

In addition your charges appear to represent an unfair term of contract which is contrary to the Unfair Terms in Consumer Contracts Regulations 1999 (SI. 1999/2083). Our account falls within the ambit of Regulation 5 of the Unfair Terms in Consumer Contracts Regulations 1999 as we are consumers. Your charges constitute an unfair penalty under Schedule 2 of the said Regulations which provide an indicative and non-exhaustive list of terms which may be regarded as unfair. Under paragraph 1(e) of schedule 2 this specifically includes terms which have the object of requiring any consumer who fails his obligation to pay a disproportionately high sum in compensation. We would vigorously contend that this is the position regarding the fee of XXXX which you deemed fit to apply to our account.

 

 

Furthermore a fee levied requiring us to indemnify you against any commercial risk to yourself in offering us a reduced interest rate in order to attract our custom is also contrary to s.4 Unfair Contract Terms Act 1977. We are confident that a court is likely to consider this clause to be unreasonable within s.11 of the said Act as a large commercial institution such as yourselves is in a far better placed position than us as consumers to bear the burden of the vicissitudes of business.

 

 

 

I would like to bring your attention to the following statement by The Office of Fair Trading:

 

"A term in a mortgage agreement which requires the borrower to pay more for breaching the contract terms than actual costs and losses caused to the lender by the breach (or a genuine pre-estimate of that) is likely to be regarded as an unfair penalty and to be unenforceable both at common law and (in a consumer mortgage) under the Unfair Terms in Consumer

Contracts Regulations. A redemption charge may be regarded as a penalty even if it is expressed as the price for exercising a right rather than a consequence of breaking the agreement."

 

We believe that the charges you have levied of £9629.94 for early redemption far exceed any true cost to yourself as a result of our breach and any genuine pre-estimate you could conceivably reach. If you disagree, then will you please demonstrate this by letting me have a full breakdown of the costs to which you have been put to as a result of our breaches, in order to reassure us that your charges really do reflect your costs.

 

 

Your responsibilities

 

 

We would draw your attention to the terms of the contract which you agreed to at the time that we took out the loan. It is an implied term of that contract that you would conduct yourselves lawfully and in a manner which complies with UK law.

 

We are frankly shocked that you have operated our account in this way as we had always reposed confidence in your integrity and expertise. We consider that your repeated representations that your charges are fair and reasonable are deceptive and that they have deceived us into agreeing to pay them. Your concealment of the true nature of your charges has prevented us from asserting our rights until now.

 

 

Our targets to resolve this matter

 

We really hope that this matter can be resolved amicably and without the need for redress to the courts. We require repayment in full of this money. If you do not comply fully within 14 days then I shall begin a claim against you for the full amount plus interest plus my costs and without further notice.

We believe that these targets are more than sufficient for a large company such as yours with dedicated staff and departments.

 

 

Yours faithfully,

 

Mr & Mrs xxxx

 

HOW CAN THEY USE THIS IN COURT

[paulpb123]

To prove your case against them?

[paddym]

that seems to be the same standard letter that others received .Nothing new in it and they still havent provided the breakdown of costs to show they havent overcharged you or given you a true estimate of their costs you have put them to. its just a standard bog off letter which it seems is also intended to scare you by saying theyll show it in court i say SO WHAT sure youll be showing the judge all the letters youve written and received back (if it gets that far ) full of usual codswallop that we have now come to expect from the mortgage companies who i believe are starting to brick it because we havent taken kindly to their idle threats and are still pursuing them dont worry theyre gonna break at some point theyre on the back foot and the corners getting closer once theyre in there we aint letting them out good luck dont panic and carry on as per your schedule !

[ellielou]

Gene

 

That's the exact same letter that I received from them at the end of last week. I'd already registered my claim, was sick of them fobbing me off & asking for 'another 5 days' etc. After a bit of coaching form people on this site I bit the bullet & registered my claim - they've got till next Monday to acknowledge.....tick, tick, tick

 

Good luck

[Guest mike grant-sinclair]

Well Sory Ive Been Away For A While And Not Had Any Thing Back From Future Mortgages Of Erc And Charges Therefore Claim On Line Done Today. So Lets See What Happens Now:d

[zootscoot]

How are you getting on Genesco?

[genesco]

I am waiting to get some funds to file my claim online.