Hi,

We are currently in the process of moving home - stress, stress and more stress!!In October, before putting our house on the market, we got an up to date redemption statement from our lender - from this, we worked out the cost of our move and what we could afford to put down on the next house ect. We sold our house just after xmas and since then have had an offer accepted on a property, had survey done, paid search fee's, mortgage offer with solicitor ect.. This morning I have recieved a new redemption figure which is £1,500 more than the October one. I Phoned the bank straight away and was told that redemption statements are processed manually and unfortunately there was an error with the October statement......they FORGOT to add a £1,500 help with costs fee that we have to pay back
I explained that this was not my mistake and that we had put our house up for sale on the strength of that redemption figure being correct - we are now £1,500 down The advisor told me that if I had checked in the terms and conditions of my mortgage, I would have been aware of the charge.........that's all well and good, but there are so many figures in the breakdown and interest working outs - that is why we asked for an ACCURATE figure from them!
I am really upset This now means that we will move into our new house with £300 left from the sale
Luckily we do have some savings but I am so, so cross and am going to write to the bank and see if we can get this fee waived - if we didn't have any extra cash, we would now have to pull out, incurring solicitors fee's, estate agents fee's, the survey fee that we paid for new house........the list goes on.
Doe's anyone have any advice as to what we should do?? I know this is a dog forum but I really needed to talk about this.

Thanks for reading

Hayley

Hi Hayley - unfortunately, I doubt there is anything you can do. Banks seem to be a law unto themselves and errors are simply swept under the carpet. I would write a strongly worded, but polite letter to the bank asking them to take this error into consideration and asking them to perhaps agree to cut the charges by 50% as a good will gesture. Good luck :)

Just had a look on a banking ombudsman sight and found this -
Similar issues arise where the firm mistakenly understates how much a customer owes on a mortgage or other loan. Sometimes the customer then considers that the firm must accept the figure it has mistakenly quoted, rather than the higher - true - figure.

What is the fair outcome to such cases?
In particular:

# Does the customer have to repay the money?
# If so, on what terms?
# Is any compensation due?

In dealing with such cases and deciding what is fair and reasonable, we are required to take into account what the law says. In general terms, the legal position is:

# Ordinarily, customers should repay money that does not belong to them, or that they have borrowed.

# But customers do not have to repay it if they have 'changed their position' through believing, in good faith, that the money was theirs - for example, by buying some expensive service that they would not otherwise have bought. Merely spending the money on ordinary, day-to-day expenditure does not amount to a change of position.

Hopefully we will be able to come to some form of agreement with the bank............Like you need this added stress though:rolleyes:

Oh, I know the feeling! we are getting a mortgage at the moment and the keep saying they are waiting for something they already have which is causing stupid delays :rolleyes:

Not the Ab*** by any chance is it :rolleyes:  If you have a complaint, put it in writing first of all to the bank.  They will have a complaints procedure and the usually send you a leaflet telling you what to do. Once you have complained and they write back and say sorry you still have to pay, then you write to their complaints people at their head office (or whoever else they have specified).  Once they write back and say sorry you still have to pay (as they always do) then you go to the Ombudsman and complain to them. It does take ages and the bank always have the upper hand because they have the money in the first place but you might just win your case. 

I eventually won mine with the Ab*** and got compensation but I had to show the Ombudsman that I had been put at a disadvantage by the bank's actions.  I think you have been put at a disadvantage by their cock up, not to mention the stress.  Hope you win - you should get your £1500 back plus a small amount for all the upset :)  Don't think oh I can't be bothered as I'll have no chance.  That's how the banks make their millions.

CG

It is certainly worth the cost of a strongly worded letter! However I have to say that having had one buildign society tell me the morgage debt had increased when I paid off an extra £10K I now ALWAYS check their maths :rolleyes:   

I will most certainly be double checking everything from now on.........after all this I'll be glad to see the back of this building society. My letter is all typed up and ready to go recorded delivery first thing Monday morning.

Not much you can do legally but the letter done nicely and not in a demanding way may swing you a discount.

The redemption figure isn't legally binding until the last 48 hours when your solicitor gets one from the bank direct.

I did notice though that you said the statement was £1500 more because of £1500 fees is your mortgage a Interest only? , if it was a repayment mortage your morgage should be lower due to your capital repayments from October.

No, we have a repayment mortgage.......I asked for another statement because we have made some overpayments and I wanted to see if they had made much difference. The reason that it has gone up £1,500 is because they 'forgot' to add a help with costs fee from when we took out a new mortgage product 2 years ago (if you repay the mortgage within 3 years of taking out the product, the costs are added) I wasn't aware that they hadn't already combined this in the redemption figure back in October:rolleyes: They admitted today that it was an error on thier part but said that it is clearly stated in the terms and conditions of my mortgage about this fee and advised me to make a complaint in writing.

Is your morgage not portable?Can you not take your mortgage with you and then when the penaty period has passed do a remortage?   very few mortages today are not portable.  If it is save yourself the money.

Yip understand about the charge.

Not sure if I explained myself well :-).. I was meaning is the penalty for the fees £1500 exactly. If it is the figure you got should be £1500 less the 3 months capital payments since October.

See what you mean......not exactly £1,500 - the capital has gone down slightly. We did intend to stay with our current lender but they wouldn't lend us as much as we needed - £13,000 more is all we needed but they wouldn't budge

A bit unflexible indeed.

These penalties can catch you out for sure.  TSB at the moment seem to be offering the best deals  4.49 fixed 2 years and they have on of the best reputation just now for their lack of tie ins also.  You can do it all just about on-line.

Hi Hayley,

Firstly, a letter of complaint to the lender which you already know.   If the situation has not been resolved to your satisfaction, you can take your complaint higher within the organisation, i.e. the Chief Executive, or whoever is the most senior person and send a copy of your letter to the 'Compliance Manager'.  Ask for details of the lenders formal complaints procedure and request a final response letter.

If the matter is still not resolved to your satisfaction, you can refer the case to the Financial Ombudsman Service (FOS).  You will have to show you have been greatly inconvenienced and have suffered financial loss or encountered financial hardship as a result of the lenders error which will greatly strengthen your case for redress.  Good luck.

Thanks so much for all your advice. I have looked into the FOS and I'm ready to fight this through.......we were mis-informed and decided to move home on the strength of those figures being correct. £1,500 isn't a huge amount of money, but add to it redemption penalty - (yes, aswell as), estate agency fee's, solicitors fee's, survey fee, stamp duty and all other bits and bobs, this move is turning out to be very expensive!

Hayley 

Hayley,

Wanted to ask if you actually received a final letter with the redemption figure? was this an offical redemption? and was it broken down?

The FOS is a tricky one as the redemtion figure is often quoted without penalties and this will say it in the small print also because a penaltie can be £2000 one day but none the next.

This isn't an uncommon error

We recieved a payment authority with both sttements. Both redemption statements have a breakdown of all costs and fee's ect.