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New fear over FSA exit fee survey

Fears have been raised that the FSA has again allowed the industry to manipulate the output of its mortgage exit fees investigation.

The regulator is understood to be locked in dialogue with the Council of Mortgage Lenders over the communication of its long-awaited results, due at the end of this week.

One source says the exit fee issue has dominated the CML’s agenda over the past couple of weeks although the trade body and the FSA are not commenting on the matter. The announcement was initially due in autumn 2006.

In July, the CML claimed it “influenced the final version” of the FSA’s initial exit fees investigation “to better reflect the current position”. The CML also made similar comments about the FSA’s summer equity-release probe.

Last June, the FSA questioned whether lenders that increase their fee during a contract term are being fair. Around six lenders are since understood to be have been quizzed over their stance towards exit fees.

Portman has this week reduced its exit fee from £199-£145, prompting speculation that it is pre-empting a possible crackdown.

London & Country head of communications David Hollingworth says: “There is no harm in seeing if comm-unication can be improved but the two must not be collaborating.”

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