As a result of a directive from the Financial Services Agency, Banks in the United Kingdom are now being instructed to return fees to clients they are deemed to have overcharged. This is of major significance to those involved within the areas of Debt Management, Debt Settlement and Bankruptcy in general as these figures could be quite substantial overall



Long overdue, this affair could cost in excess of ?300 million at the end of the day. Part of the problem lies with potential conflict of interest scenarios whereby the conveyancing quite often is carried out by the Banks own appointed ?Panel Solicitor? who are unlikely to question too deeply any of the banks own imposed charges. The Lawyers feel that there quite often is case for being removed from a lenders panel if they were to question the ethics of the transaction and to be honest it is always better to have an independent conveyancing professional supervise this type of transaction anyway.

To put it simply, the problem is as follows. At the outset of any agreed Mortgage or Loan there is always the fine print that entails what additional charges there are that need to be settled in the event of early settlement. It's funny this (actually it's tragic but that is another issue) but these issues are very rarely to be seen when they are busy trying to prostitute themselves into trying to get you to do a deal with them in the first place.

Back to the matter in hand, the points referred to, cover a wide variety of issues and one of which relates to the cost of early redemption of the mortgage. This last fact is quite ludicrous as if they haven't made enough out of you during the term of the deal but that is another issue. The bottom line is that your lender shouldn't make alterations to your agreed amounts without your prior acceptance of these changes. If they do (which some of them have done) then you should complain to the Financial Services Watchdog ? the Financial Ombudsman.

If you think you have spotted any changes then the first thing you and/or representative should do is go through your original agreement with a fine tool. If they are insisting on more and have dreamed up some spurious excuse for this and you don't agree then threaten them with the Watchdog and don't take this lying down! If they refuse or give you some sort of lousy explanation that we all know smells then complain and threaten them with the Ombudsman. This usually is enough to get them to cough up the money as at the end of the day none of our glorious financial institutions likes the bad publicity of being dragged through the Courts and also the papers!

As in all areas of negotiations then as a matter of course do not accept the first offering that they deign to throw at you. I have a client who has just settled a matter with the UK's largest Mortgage lender (you know who you are) over a dispute over interest charges and they initially offered him a derisory ?25 compensation figure and when the agreement was finally settled it end up at ?379!

So the moral of the story is? Always (repeat always several times) check the fine print of any contract before you sign it and if someone tries to ?slip something past you? without you knowing and you find out? The sooner that you disabuse them of this notion, the better for you and for some of the other silent borrowers that these institutions have either ?ripped off? over the years or are trying to rip off now! Howl and complain as loud as you can!