The majority of lenders have decided to fix exit fees at their current level and offer refunds to those customers who were charged higher fees when redeeming their mortgage than were in place at the outset.
However, Robin Gordon-Walker, spokesperson for the FSA, warned: “We have received the majority of responses from lenders and the ones we’ve analysed so far seem to be going for option two. However, lenders will have to justify why they are keeping an increased fee and quickly. We will evaluate the justification to see if it stacks up. If we believe it doesn’t, we have a number of powers we can use.”
A number of lenders have reduced their exit fees, including Skipton, Portman and West Bromwich Building Societies.
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However, the majority have maintained their current stances, claiming they have looked at the market and taken that into consideration when making their decision.
Vic Jannels, managing director at All Types of Mortgages, commented: “It’s not acceptable to charge excess fees. I can understand paying a charge if I was told it was to cover specific things. However, two or three years ago, most lenders were only charging £50 but now many are over £250. At the minute, I can’t see what we are paying for.”
Simon Biddle, head of marketing and communications for Infinity Mortgages, said: “This is an own goal for the industry and the issue has only occurred because some lenders have hiked their fees dramatically. The FSA’s move is a warning shot across lenders’ bows and they should take notice.”
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