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GE could ditch loan portfolio

GE Money Home Lending is considering dumping a portfolio of loans it services after Which? found discrepancies that could cost customers hundreds of thousands of pounds each.

Which? found that a £269 legal fee on one mortgage sold in 1991 by Redfern Financial Services could turn into a £162,672 debt on top of the homeloan because of compound interest at a 29.2 per cent rate over the 25-year term.

GE has written off that debt but it does not know how many similar loans there are. It has been administering Redfern loans since 2005 but says it is “reviewing this relationship” following the Which? complaint. GE spokesman Tom Wilson says: “We are investigating if there are any similar cases. As servicer, we have no control over Redfern’s lending policies.”

Which? principal researcher Teresa Fritz says: “We have asked GE to confirm how many loans it runs with this charge and how it intends to let customers know.”

GE was at the centre of controversy in August when it emerged that claim firm Loancheck has dozens of cases of alleged non-disclosure of commission against the firm and it will shortly seek compensation.

Money Marketing highligh-ted two cases at the time and although GE said it would provide written proof that the commission was disclosed, six weeks later, it has failed to do so.

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