Customer cashback after FSA mortgage fee ruling

07 March 2007
Most banks and building societies are offering refunds to customers hit by escalating mortgage exit fees, following the FSA deadline last week for lenders to justify raising fees or fix them at a steady level.

Mortgage exit fees trebled over the last decade, according to moneysupermarket.com, with thousands of customers forced to pay more when their mortgage ended than the sum they had agreed to in their contract.

A number of lenders have now set up designated refund teams to appease angry customers.

Since the February 28th deadline, "all the decisions announced have been in favour of the consumer," Louise Cuming at moneysupermarket.com observes.

Abbey and Alliance & Leicester have established units to manage paying refunds to customers who ended up paying more than originally agreed.

Other providers have pledged to help customers reclaim the difference between what they were originally promised and what they later had to pay, including Barclays, Cheltenham & Gloucester, Halifax and Nationwide.

The average charge for redeeming a mortgage is now £295.

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