My Mortgage Fees Were Refunded!!!!!!!!

[gizmo111]

I thought most sub prime lenders want at least 85% LTV, so that plan may not work. Others may know better.

[MortgageMan]

Hi Ruare

Leave it with me and I will have a look for you, On your creditors if you owe £70k, I would have thought that the most you ought to have to pay out is £7/£10k over a 5/10 years period or tell them you have x amount for full and final settlement. I handle quite a lot of cases like this. With out having a list of your creditors its hard to make statements but I think you are paying a lot per month I dont know what is or is not allowed on this site but I think you can send a private message and I will assist you

Trevor

[MortgageMan]

Hi gizmo111

I missed your point some sub prime lenders will now go to 95% and self cert, The percentage depends on how you have conducted your mortgage in the last 12 months and your credit rateing, any other points just ask

Trevor

[rascal3103]

one question. is the morgage route still restricted to the 6 years like bank statements ?

[zootscoot]

No 12 years applies to mortgages

[rascal3103]

Happy Days.

I have emailed Abbey, as they are shut today and asked the, for my final repayment schedule for when I completed early on my mortgage.

 

Lets see what happens

[Stevegrray1978]

I got a letter today from Platform responding to my prelim letter claim. They are refusing any refund.

However, in their response they say:

 

"A number of items are taken into account when determining the level of early repayment charge, some being:

-The revenue which we have foregone by the customer redeeming their mortgage early.

-Recovering some of the costs, which we have originating, funding and servicing a mortgage over its expected lifespan.

We also belive it is unfair on the customer who continues with their mortgage contract to cross subsidise the cost we incur from other customers who redeem their mortgage early."

 

I could do with some advice on how to proceed with this... I'm not sure if this is an explaination of the costs they face as a result of the loan being paid early (an explaination of which is requested in the prelim letter), or is this them admitting (unwittingly) that the redemption charge is a penalty that bears no real relation to the mortgage being redeememed...

 

Thanks for any advice! Not sure if it's worth persuing this one at the mo...

 

Steve

[thunderpuss2k]

If you asked them to provide a breakdown of costs, they should provide just that. A vague overview of what they might have done with some of that money isn't good enough.

 

'The revenue which we have foregone by the customer redeeming their mortgage early' - what is the figure attributable to that revenue?

 

'Recovering some of the costs, which we have originating, funding and servicing a mortgage over its expected lifespan.' - again, what precisely are the actual costs of these things mentioned, and what proportion of those costs would they be attempting to recover via an early repayment penalty?

[andrew1]

I've just had a quick look at this posting, but I seem to recall the argument earlier that to have a mortgage company claim that they are losing money by having the mortgage period ending earlier was a non starter because they recycle the monies and reuse it for someone else as that is their business. Someone put up a strong argument to that point. It's not like the same would happen to an individual as we are not mortgae providers. Maybe worth searching back on this thread for it.

 

Sorry to interupt !

[andrew1]

No 12 years applies to mortgages

 

 

Does this mean that if there were penalties paid for early redemption as far back as 12 years it can still be claimed?

[dashngail]

Today we received a reply to our last letter to Mortgages PLC (our letter was posted on this thread on the 20th July) we asked for a breakdown of what the redemption figure was made up off.

Here's the reply we got this morning.

 

Firstly, I would confirm the OFT's statement 18 May 06 specifically related to bank credit default fees, not early repayment charges on mortgages. The two fees are fundamentally different, and relate to two different products. The early redemption charges applicable to our mortgages are not default charges and as such the OFT ruling does not apply.

All lenders opperate a variety of approaches in determing how to price products and our early repayment charge is an intergal part of the overhaul pricing of our products. Your product offered you a 2% discount off our standard variable rate for 18 months in order to be able to offer this discount and enable us to fully recoupe it was necessary to implement a 3 year early repayment charge period. Our previous letter clearly states our the early repayment charge that applied to your mortgage. You accepted the terms of this mortgage and your loan completed on this basis

I am sorry that I have been unable to resolve your compliant to your satisfaction.

You may treaat this as a final response letter in order to persue the matter with the financial ombusman.

 

Comments on the above please, we think we should now go ahead with issuing court papers since there letter doesn't answer anything that we asked.

Are we correct in assuming that the statement from the OFT is not correct.

Help please

Thanks

Dashngail

[thunderpuss2k]

Firstly, I would confirm the OFT's statement 18 May 06 specifically related to bank credit default fees, not early repayment charges on mortgages. The two fees are fundamentally different, and relate to two different products. The early redemption charges applicable to our mortgages are not default charges and as such the OFT ruling does not apply.

 

Which is true. Sort of. However, the OFT did say:

 

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.

 

Back to your letter..

 

Our previous letter clearly states our the early repayment charge that applied to your mortgage. You accepted the terms of this mortgage and your loan completed on this basis

 

Yes all very well and good, but it does not tell you how the charge was calculated. In the absence of this information, you can only assume that does not accurately reflect the actual costs and losses caused to them by you terminating your contract early, so by the absence of that it is a penalty - and therefore irrecoverable, etc etc.

 

You may treaat this as a final response letter in order to persue the matter with the financial ombusman.

 

Final response? Fair enough. If they won't explain how they calculated their charges to you, as their customer, maybe they'll explain it to a District Judge? So to answer your question, yes I'd go ahead and issue a claim.

[dashngail]

Thanks for your VERY quick response.

Here we go then, will sort the court papers tomorrow.

We're just a little confused at one point in your reply, where you say "irrecoverable", do you mean from their point of view.

 

Yes all very well and good, but it does not tell you how the charge was calculated. In the absence of this information, you can only assume that does not accurately reflect the actual costs and losses caused to them by you terminating your contract early, so by the absence of that it is a penalty - and therefore irrecoverable, etc etc.

 

Thanks

Dashngail

 

 

 

[andrew1]

Great news for dashngail and good luck can use some of that myself Thunderpuss your a mine of information... any thoughts on my posting above8-) ?

[thunderpuss2k]

Irrecoverable from their point of view yes - under English law Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 a contractual party can only recover damages for actual or liquidated losses incurred from a breach of contract. It's similar under Scottish law, and went as far as the House of Lords - Castaneda and Others v Clydebank Engineering And Shipbuilding Co., Ltd [1904] SLT 498. This is one of the main points that you are making when you ask for your bank charges to be refunded. You ask the bank to show that the charges are fair by providing a breakdown of how they are calculated, and to what loss and expense they are put. They refuse, so you can only assume they are not actual or liquidated losses, and therefore as they are not actual or liquidated they are not recoverable under law. Or to put it another way, they can't get the money back from you. By charging you these fees it's technically theft. But don't hold me to that last bit

 

I'll respond to everything else in the morning, it's getting late now

[Patricia C]

Don't know if I'm doing this ok? Or if I am in the correct place on the website forum!! But I am just in the process of asking Yorkshire bank for my refund of charges - I was amazed to see it totals £800! has anyone recieved anything back from Y/B? Incidentally, I have just received 6 years worth of statements from them..it took me 2 letters and 2 phonecalls, plus £10. And took them nearly 4 weeks! Patricia C

[chrismc]

Some good info there Thunderpuss!!

 

Patricia C Check here Yorkshire Bank Forum

 

Chris

[thunderpuss2k]

Does this mean that if there were penalties paid for early redemption as far back as 12 years it can still be claimed?

 

Well, it's a little complicated. The Limitation Act 1980 section 5 says that the time limit for an action founded on simple contract is six years. However for a special document - which a mortgage deed falls under, as it's under seal, it's twelve years.

 

With me so far? That's the easy bit. However, there are some further clauses in the Limitation Act 1980 about mortgages, in section 20:

 

20(1) No action shall be brought to recover -

 

(a) any principal sum of money secured by a mortgage or other charge on property (whether real or personal) .. after the expiration of twelve years from the date on which the right to receive the money accrued.

 

(5) Subject to subsections (6) and (7) below, no action to recover arrears of interest payable in respect of any sum of money secured by a mortgage or other charge or payable in respect of proceeds of the sale of the land, or to recover damages in respect of such arrears shall be brought after the expiration of six years from the date on which the interest became due.

 

This means that the lender can take action to recover any capital payments for up to 12 years. However, in terms of trying to recover any arrears in interest payments, it's six years.

 

I personally think the simple answer to your question is twelve years. Any argument that you couldn't claim interest on the charges as the interest began accruing over six years ago could be an interesting one. The County Courts Act 1984 says you're entitled to 8% interest from the date the sum began due to the date of judgement - but I'm not sure how that would be affected by the Limitation Act 1980.

[andrew1]

Thunderpuss2 - man or woman - you're a gem!

[tillers]

Again sorry guys and girls to hijack the thread, I sold my house last Oct, 18 months in to a 3yr arrangement with Capital Home Loans, they charged me a little over £12,000 early redemption penalty!!! I still have the bruises!!! We had to sell quickly as financial blah blah, took a low price then took a hit and the rest is history, God I want that money back please some one show me the way, would happily donate 5%, along with the Natwest,HSBC and Credit cards!!!!

[dashngail]

Hi

The best advise anyone can give you is to first read, read and read again everything on the site, and be prepared to see this through to the end.

 

Then get all your paperwork together and send off your first letter.

 

We are at the stage of issuing a small claim, our paperwork has gone off today. We have followed the steps for bank charges with a few nips and tucks.

 

There is always plenty of help and support on this site every step of the way.

 

Unfortunately claiming back redemption fees is in a very early stage, but people are getting them money refunded.

 

Go get them!

 

Best of luck

 

Dashngail

[DianeC]

Hi, VERY interesting thread and some brave people out there. I salute you all.

 

So, would I be correct in assuming that a mortgage lender could only really claim back:

 

• In the case of a discounted mortgage being taken out, the value of the interest discount. (Seems fair)
  
• In the case of a cashback mortgage being taken out, the amount of that cashback, plus interest at normal rates (to be extra generous and fair to them).
  
• The cost of administrating the mortgage for as long as a person has that mortgage with the company. (Not for the length of time the mortgage was taken out, initially, of course).

And if yes, would I therefore be right to say that any costs above and beyond these three instances would be unfair penalities according to the OFT, and therefore should be claimable?

 

If I'm right (and yes, I have read the whole thread, just trying to simplify it all in my mind) then a simple list like this used in one of the letter templates when asking for a break-down of those charges might be useful. Can anyone else add to the list at all?

 

We are looking at reedeming a mortgage early this year, hopefully. But (and get this) our redemption charges are a thousand pounds higher in this, the mortgage's second year, than they were last year, and a thousand pounds higher from what they will be next year. (!?)

 

We're in a three-year discounted mortgage. Only discounted by a quarter of a percent, though our charges for redeeming this year will be well four and a half thousand pounds. Sigh.

 

I might write and ask them for a breakdown before we sell. Will keep you all posted. The mortgage is, by the way, with The Leeds & Holbeck - the society at the beginning of this thread, I believe.

 

Best to you all.

 

Diane. -- Going off to sort out bank charge refunds.

[maroonfox5]

Diane c

 

Have you thought about porting your mortgage with L&H?

 

Might be worth a try, and if they will not let you ,then it could be useful in the future if you were to claim.(the fact that you asked and were turned down etc)

 

Regards

 

MF5

[DianeC]

Hi maroonfox5,

 

We want to get rid of our mortgage completely, grab the equity and buy something outright. (A person can dream, eh?) My husband has recently been told he's heart-attack high-risk, so we can do without the stress of a huge (and it is huge) monthly mortgage payment.

 

We'll see. I will keep you all updated though, for certain, when we go for it. Basically, I'm going to fight the redemption penalties over and beyond what I think their expenses are. I mean, how can they raise the penalty by a thousand in the second year then drop it again for the third? The only way this makes sense is to look at statistics that say mortgage borrowers are more likely to re-mortgage during that second year. Therefore, we're being penalised MORE in that year purely to stop us re-mortgaging elsewhere.

 

Is this reasonable? I don't think so.

 

Diane.

[maroonfox5]

Good luck and keep us posted on your progress.

 

Regards

 

MF5