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Rate Matcher customers charged increased arrangement fees

September 13, 2008 by admin  
Filed under News, News-Mortgages

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Back in April of this year the high street lender HSBC announced the launch of a new mortgage product designed to help homeowners who were on cheap fixed rate mortgages that were due to come to an end. The bank promised to match the current interest rate of those on low rate fixed mortgages with any other lenders, which meant that homeowners whose cheap fixed rate mortgages were due to end would not have to worry about going onto a high standard variable rate.

Consumers hoping to go onto the Rate Matcher mortgages have to meet eligibility criteria, and an arrangement fee is also involved. The mortgage product was initially only launched for around six weeks, but proved so popular that the bank decided to extend this period. However, in addition to extending the offer on the mortgage range the bank has also hiked up the arrangement fees on the mortgages

An official from the bank said: ‘We were left with a choice of pulling the offer or increasing fees.’

However, the topic of extortionate arrangement fees has now been addressed by the Chancellor of the Exchequer, Alistair Darling, who is discussing these fees with the UK’s financial regulator, the Financial Services Authority. According to reports HSBC was charging some Rate Matcher customers up to £5000 by way of an arrangement fee previously, but with the hikes some customers may end up paying up to £10,000.

Alistair Darling has accused some lenders of ripping customers off by charging extortionate arrangement fees on mortgages, and he is looking to get an idea of what could be classed as a fair fee through engaging in talks with the Financial Services Authority.

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  1. Try before you buy housing could prove effective says:
    September 13, 2008 at 1:47 pm

    [...] Rate Matcher customers charged increased arrangement fees [...]



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