'My lender didn't say there'd be an early repayment charge when I asked about redeeming my mortgage'


Ole’s mortgage lender didn't make clear that he’d have to pay an early repayment charge when moving house.

What happened

Ole was selling his house. His solicitor contacted the lender and asked for a redemption statement, to check how much he’d need to pay from the sale proceeds.

Ole based his calculations for his new mortgage on the lender’s statement. However, when the solicitor sent the payment the lender said it wasn’t enough, as there was a £1,500 early repayment charge that hadn’t been taken into account. The lender apologised for the oversight, but said Ole was contractually required to pay the shortfall. This caused Ole a good deal of worry, as it meant he was short of funds to buy his new home.

What we said

Fortunately, Ole had been able to renegotiate a lower price with the seller. But the lender’s mistake had been stressful for him, and we thought it should do more than offer him an apology. We told the lender to pay Ole compensation for the upset and embarrassment he’d experienced.