Mortgage Exit Fees (MEAF)
Incurring mortgage exit administration fees, or MEAFs, when closing a mortgage account or switching to a new lender, can seem inherently unfair.
When you pay off a mortgage you will be charged a fee, technically known as a mortgage exit administration fee (MEAF). It is supposed to cover admin and legal costs such as; switching the registration of the property and Land Registry.
MEAF’s carry names such as; sealing fees, final administration fees, discharge fees and final redemption fees; but are not to be confused.
Early redemption fees can not be reclaimed: these are charges that occur when you repay or switch over your mortgage during a special deal such as a fixed or discount rate.
Where as MEAFS can be reclaimed; these are uniformly charged when you pay off or switch your mortgage, regardless of what the deal is. This entails that you will often have to pay both a redemption penalty and a MEAF.
Recently the Financial Services Authority (FSA – an independent organization put in place to regulate industry providers of financial services) reviewed mortgage exit fees and concluded that the majority of these charges were under breach of the Unfair Contract Terms Act 1999.
The FSA’s advice reads as this:
- If you believe you have been charged a higher exit fee than stated in your mortgage contract, contact your lender to find out if you are eligible for a refund.
- If you are a new borrower you should know from the outset what exit fee you will pay and should be given a clear idea of how the fee could increase, fairly.
- Check all the mortgage fees and interest rates when comparing mortgages and lenders, and consider what impact the fees will have on your overall costs.
Our website will provide you with vital information on how to reclaim these fees. We can provide a free Find a Solicitor service to match you with a legal professional who can help you through the claiming process and ensure that you are treated fairly, and conduct your reclaiming process confidently and professionally.