Check Mortgage Exit Fees, Before Remortgaging

Posted 2007-12-17

Check the exit fees before changing lender – This is the most important fact for mortgage customer to know when changing lender because exit fees sometimes can just hit the roof.

The Financial Services Authority (FSA) has made a ruling that customers who paid an exit fees that was higher than the amount specified in the original terms and conditions of their mortgage contract can reclaim their exit fees. According to research from mform.co.uk, in spite of efforts by the Financial Services Authority (FSA) this august, to make mortgage exit fees terms more transparent, those with a mortgage still have to pay £150 when they leave one lender for another.

This research takes into account  the fact that the Royal Bank of Scotland Group companies, Standard Life Bank, Cheltenham & Gloucester and Lloyds TSB have no exit fees, but it’s  findings also indicate that others put out such fees on their customers who sometime have to pay as high as over £100 as exit fees. 

It is therefore imperative for people who regularly remortgage, to check their mortgage exit fees, so that it does not come as a nasty surprise to them. Lenders do not charge such fees as part of their administrative costs, but as part of their mortgage deal. This fee must be taken into account along application fees and other costs to determine the overall cost of the mortgage.

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