Mortgage exits fees had remained constant for many years, but in 2004 they started to rise sharply. The lenders pushed up these fees by hundreds of pounds with some as high as £300.
The Financial Services Authority has now agreed that some of these were unfair and borrowers who paid these fees may be able to claim a refund.
The first thing you should look at is the original fee you were charged in your mortgage agreement, for example £85. You should then check to see how much that fee increased when you were a customer and demand the difference.
If you feel you have been over charged you should first contact your lender and complain. Your lender may pay you back the difference rather than let you take matters further to the Financial Ombudsman or small claims court.
It is estimated that the admin cost for closing a mortgage should be no more than £45.
It should be noted that exit fees are charged for the administration work involved in closing a mortgage and should not be confused with early redemption penalties.
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