View more on these topics

Brokers call for exit talks as just two lenders rethink fees

Mortgage brokers are calling on trade bodies and the FSA to open up a debate on what level of exit fee is reasonable.

Only two out of the top 20 mortgage lenders have confirmed that they will be scrapping exit fees for new customers despite the FSA’s July 31 deadline for lenders to “review” their charges.

Cheltenham & Gloucester and Bristol & West join HSBC, ING Direct and Stafford Railway Building Society in not charging an exit fee.

Brentchase Financial Services mortgage specialist Mike Fitzgerald believes the Council of Mortgage Lenders and the Association of Mortgage Intermediaries should come up with a way of forcing lenders to charge reasonable fees.

Fitzgerald says: “It is disgraceful how high some of these charges are, such as £295. That is just not right. I think we have got still got a long way to go to make it transparent.”

He says a charge of about £50 would be more reasonable and cover lender’s costs.

Although the FSA has made it clear that it does not set prices for the products it regulates, it says lenders should ensure that the exit fee represents the true costs of the lender’s admin services.

Nationwide charges the lowest fee at £90 but the pressure is on lenders such as Alliance & Leicester and Woolwich, which charge more than £250, to justify their charges.

Seven of the top 20 lenders have no plans to change their current fee pricing. A large majority of lenders, including major players such as Halifax, Abbey and Northern Rock, are still undecided despite the looming deadline.

The Mortgage Practitioner sole practitioner Danny Lovey says: “We have to keep banging on about this. We cannot let lenders off the hook. The real cost is about £35 – not £250 or however much lenders are charging.”


A platform for success

Despite many years as a tied adviser, it was only on becoming an IFA that I began to understand concepts such as risk profiling, diversification and portfolio modelling. It was Skandia that showed the way.We wanted to provide long-term value within our client relationships and, in doing so, we had to structure our business model […]

Kane becomes ABI chairman

Scottish Widows chief executive Archie Kane is the new chairman of the Association of British Insurers, succeeding Keith Satchell who ends his two-year term.

Trusts and Taxations

Take a look at the trusts and trustee taxation video – The definition and classification of trusts. Once you’ve viewed the boxset, visit our Test Centre to test your learning and get your CPD certificate. View here


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm