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Can anyone explain what a lending fee is? London Mortgage Co. added a lending fee


fireflyer
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Hi

I am about to start my claim with The London Mortgage Company for charges/fees added to the mortgage. This was a second charge loan/mortgage.

It was redeemed in 2007. On the original credit agreement it states a lending fee of £2400.00 was added.

I have been in touch with LMC - now Acenden. They cannot explain what this lending fee was or why it was added to the loan. However, they said if i write to them they will endeavour to look into the history of the agreement and try to find out. I have sent the letter yesterday.

I am wondering if this is possibly a hidden or secret commission paid to the broker?

I have received all my statements after sending in my SAR.

Not sure if this is the correct forum regarding mortgage charges/fees claims?

Thanks

Fireflyer

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Hi Fireflyer,

 

I am just making an educated guess but I would imagine the most likely possibilities are:-

 

A fee paid to a broker for arranging the mortgage which has been added to the mortgage - this is different from a secret commission which is paid to the broker without the knowledge of the borrower and is not added to the mortgage but comes out of the coffers of the mortgage company.

A fee for a fixed, discounted, capped or other type of special interest rate which may have been applicable at the time the mortgage was taken out.

A mortgage indemnity premium - these have been pretty rare since the crash in the 90's but were a premium charged to the borrower for the mortgage company to insure itself against any losses arising from a shortfall in the event of possession.

 

Hopefully someone else who knows LMC will come along with a definitive answer. I would point out that LMC are not now Acenden, Acenden are just the servicing company for LMC although they are linked as they are both part of the bankrupt Lehman Brothers group (Acenden has been subject to a partial management buyout).

 

KC

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Hi

thanks for your reply.

I am asking LMC to fully explain this lending fee - exactly what it was charged for and also if any commissions were paid to brokers etc.

I'm also doing the same with GE Money.

ty again

Fireflyer

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Hi

thanks for your reply.

I am asking LMC to fully explain this lending fee - exactly what it was charged for and also if any commissions were paid to brokers etc.

I'm also doing the same with GE Money.

ty again

Fireflyer

 

You won't get a straight answer out of GE Money. You will end up dealing with the @rses in the contigous litigation department. (great department):evil:

 

Find out which solicitors dealt with the inception of your loan. May be Bernard Eliston Sandler & Co in the same building as GE. SAR BES&Co (or any other solicitors that GE used for your loan) and they should eventually roll over and give you all the details GE Money don't want you to have.

 

It's the underwriting sheet, underwriters notes and correspondence relating to the disbursement of your loan that you want.

 

Best of luck, HJS

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sounds like a broker fee to me.. divide the lending fee by the loan amount that was requested, you will prbably find it comes to 1 - 3 % in which case it works as follows

 

Broker has an arrangement to sell a product from a finance company.

Finance company may or may not pay commission for the loan

Finance company will pay commision for any insurance sold

Broker can also charge what they think they can get away with

Broker can add broker fee (read lending fee) to the loan agreement

FInance company pays the customer X amount from loan and Broker Y amount from there bank account

 

i.e. Day 1 commssion / Day 1 cash as its referred to

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