Excessive mortgage exit fees ''to be paid back''

Excessive fees for closing mortgages may be coming to an end because the Financial Services Authority (FSA) has told lenders that they must be able to justify their demands.

Many banks and building societies have raised their prices for paying off, or exiting, a mortgage so that people are charged far above the level of fees that were originally agreed.

This means that some fees, which cover administrational work or the handing over of deeds, have doubled in some cases.

However the FSA has now ruled that lenders should hand back a total of around £200 million to consumers hit by unfair fees.

Melanie Bien, from mortgage broker Savills Private Finance, told the Times: "Anyone who has remortgaged in the past few years - and that is a lot of people - will be able to make a claim, depending on their lender''s stance."

This, in conjunction with recent demands for the return of unfair overdraft charges, may cost the banking industry a great deal of money.


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