FSA statement on mortgage exit administration fee increases

The Financial Services Authority today set out its views on recent increases in mortgage exit administration fees (MEAFs), and how it expects mortgage lenders to address the issues raised.

The FSA is responding to recent concerns that MEAFs had been increased unfairly, so consumers were being charged higher exit fees than they had expected to pay. Lenders often charge MEAFs when borrowers pay off their mortgage or switch to another lender to cover the staff and other costs involved.

Clive Briault, FSA Managing Director of Retail Markets, said: "We expect that these measures, agreed with the Council of Mortgage Lenders, will stop borrowers from being surprised by unexpected increases in these fees. People will now know when they sign up for a mortgage what fee they will pay on exit, or should be given a clear idea of how the fee might be increased fairly."