FSA urges homeowners to reclaim excessive mortgage arrears charges

By Elliot Wright, 26th January 2010

Homeowners could be in line receive millions of pounds compensation for unfair mortgage arrears charges after a crackdown by the Financial Services Authority.

The FSA recently forced specialist lender GMAC-RFC to repay £7.7m to customers it treated unfairly and it has been revealed that a further 30 lenders may be subject to the same action.

According to the FSA, customers of these lenders - which include Bradford & Bingley, Kensington, Morgan Stanley and Derbyshire and Cheshire building societies -could be due refunds if they were victim to excessive mortgage arrears charges.

To get a refund, customers must first make a formal complaint to their lender. If the company's response is unsatisfactory, or if it fails to write back within eight weeks, then the complaint can be lodged with the Financial Ombudsman Service. The FOS is a free and independent service set up to settle disputes between consumers and financial firms.

For more information on how to reclaim mortgage arrears charges please consult our free guide here.

Cerris Tavinor, a spokeswoman for the FSA, says: "We completed our investigation into Gmac and published the results of that case. We have made the point publicly that we have referred other lenders to enforcement, so other work is carrying on. But we can't talk about individual firms. If there is evidence that a firm is doing something wrong, then we investigate that firm and take action.

"If borrowers are worried about their situation, they can make formal complaints to that lender. Anyone worried about arrears, getting into arrears and how arrears are being managed can ring our consumer contact service to get more information about the help that is out there."

Useful links:

How to reclaim mortgage arrears charges

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