Lenders' actions in respect of early redemption penalties has sparked reaction with intermediaries who believe applying increases retrospectively shows bad faith.
Geoff Griffiths, partner at Shire Financial Management LLP, comments:
"While brokers understand the motive behind the changes to early redemption penalties it seems unacceptable to levy them against existing borrowers who took out their loans before these charges were raised.
"If one takes a mortgage now, where the key facts illustration clearly shows these charges, then that seems fair enough. But to add them retrospectively seems utmost bad faith, even though the 'small print' may permit it. If a lender wishes to keep their existing borrowers they should make the available rates to them competitive."
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Matthew West on 020 7484 9893 or email [email protected].IFAonline
Partner Insight: Continuing the Architas education series for clients.
What made financial headlines over the weekend?
290,000 already affected
Putting the tech into protection
Square Mile’s series of informal interviews