High exit fees are not a problem as long as the mortgage itself is good value, says John Charcol senior technical director Ray Boulger.He believes that a good deal will often mean an exit fee will not be triggered as the borrower will stay with the lender. Boulger’s comments come after new lender ING Direct, which does not charge exit fees, claimed this week that the average cost to a lender of a borrower leaving is 35 but some lenders charge up to 295 in exit fees. The FSA is expected to reveal the outcome of its investigation into exit fees in the coming weeks after it asked lenders earlier this year to justify their policy of raising the fee during the mortgage term. It revealed last month that the average charge has risen from 98 in 2003 to 184 last year. Boulger says: “An exit fee is just one part of the deal so if the mortgage is good value, then the size of the fee is not so important.” The Mortgage Practitioner sole trader Danny Lovey says: “It is now clear that the day of reckoning is near for lenders who charge disproportionate deeds release and administration charges relative to the actual cost. “In the spirit of treating customers fairly, this issue is now going to be the watershed. We will find out if the FSA is prepared to put the consumers’ interests first and gain the respect of the market by heavily fining those who have blatantly gone against the whole sprit of treating customers fairly. If lenders are not brought to heel, nobody will have any confidence in the FSA.”
The Financial Services Compensation Scheme is processing 501 claims against Berkeley Independent Advisers, 354 of which relate to endowments. Berry Birch & Noble Financial Planning (Weston) has now been declared in default by the FSCS, with five claims against the firm.
Hiscox insurance portfolio manager Alec Foster says the 68m fund’s recent performance has been driven by the benign US hurricane season. Foster says many insurers took evasive action after destructive hurricane seasons in 2004 and 2005 by increasing premiums. The 32-stock fund has a 40 per cent weighting in reinsurance and Foster says it has […]
The Office of Fair Trading has referred the UK payment protection insurance market to the Competition Commission.It has slammed excessive commissions in the sector and has published its analysis of the market for a consultation process that ends on November 30, ahead of a decision early next year on the future of the sector.The OFT […]
The FSA has publicly censured GD Tancred Financial Services for not clearly explaining and documenting the risks of income withdrawal to customers with small pension pots. GDT is writing to all income withdrawal customers to make them aware of the risks.
Capital Market Notes, December 2016 David Lafferty, Chief Market Strategist at Natixis Global Asset Management, discusses the outcome of the Italian Referendum. Read the full article here
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