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Banks Repay Millions In Unfair Fees

Aug 17, 2007
Surprise Surprise, no one spotted this, or did they?

The United Kingdoms Financial Services Watchdog has ordered the Banking Industry to refund to clients upwards of 300 million pounds in over paid mortgage redemption charges.

This whole affair could cost the Industry upwards in excess of 300 million pounds and is long overdue. Part of the problem lies with potential conflict of interest scenarios whereby the conveyancing quite often is carried out by the Banks own appointed Panel Solicitor who are unlikely to question too deeply any of the banks own imposed charges. The Lawyers feel that there is quite often a case for being removed from a lenders panel if they were to question the ethics of the transaction and to be honest it is always better to have an independent conveyancing professional supervise this type of transaction anyway.

To put it simply, the problem is as follows. At the outset of any agreed Mortgage or Loan there is always the fine print that entails what additional charges there are that need to be settled in the event of early settlement. These issues or points somehow never seem to be that obvious or important at the outset and can always be found by studying the smallest of print usually half way down the back page of any agreement.

Anyway to get back to the point, these charges cover a great many issues and one of which is the cost of redeeming the mortgage and the paperwork cost. This last fact is quite ludicrous as if they have not made enough out of you during the term of the deal but that is another issue. The main issue is this; your lender should not raise the level of the agreed exit fees during the term of your deal. They make changes and think that they can get away with it but if you find out that this has happened to you without your knowledge then complain loudly to anyone who will listen, preferably the Financial Services Watchdog!

If you think you have spotted any changes then the first thing you and/or representative should do is go through your original agreement with a fine tool. If they are insisting on more and have dreamed up some spurious excuse for this and you do not agree then threaten them with the Watchdog and do not take this lying down! If they refuse or give you some sort of lousy explanation that we all know smells then complain and threaten them with the Ombudsman. Very few Financial Services Managers want the world to find out exactly how they treat their customers. We all know how they do but the last thing they want is the media to find out and by default even more people, it is bad for business!

As in all areas of negotiations then as a matter of course do not accept the first offering that they deign to throw at you. On a point of principle you owe it to yourself to stand firm and make sure that you are not some sort of silent victim, those days are over and the sooner they take it on board the better!

The lesson to be learnt from the entire exercise is? Make sure that you or your appointed representative is thorough about their pre signature checks and if the lenders think they can try and slip something past you without your attention? Howl and complain as loud as you can!
About the Author
Stephen writes on Financial matters for

and also for it's sister site
Personal Bankruptcy. Commenting on how these can also have side effects, he
also contributes regularly to
High Blood Pressure
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