The FSA ruled last month that borrowers must be told more clearly what exit fee they will pay or how that fee might increase fairly. The regulator said lenders must tell it by 28 February what they intend to do.
David Fields, head of banking at the ifs School of Finance, said: “Banks and building societies have demonstrated a general willingness to ensure their customers are treated fairly.
"However, it remains imperative that customers should consider the overall cost of a mortgage i.e. administration and exit fees as well as the interest repayments, before they make what is likely to be the biggest financial decision of their lives.”
Fields continued: “Of course some banks, such as HSBC, do not charge any exit fee but those that do have made encouraging steps to reduce them over the last few weeks.
"For example, Barclays recently stated they will honour the original cost borrowers signed up for – so customers can be certain that the exit fee they signed up to at the start of the mortgage will be the exit fee they pay off their mortgage.
"Building societies have also reacted positively to the FSA announcement, with Kent Reliance reducing their mortgage exit fee by £75 and the Portman doing so by £50.”
