Can Alliance & Leicester charge me for a reference letter?

Q I wrote to my mortgage lender, Alliance & Leicester, for a letter of reference in April. This apparently is not something branches can do, so one must request it centrally. I had requested that the letter be sent to a person in Canada.

By April 24, no letter had been received, and on April 25 I discovered that the bank had sent the letter to me, instead of to the person in Canada. It arrived on April 29, at which point I discovered that I had been charged ?60 for it! Not only did I receive no warning of this charge, but it has been added directly to my mortgage account, without any option, thus forcing me to pay interest on it for the mortgage term.

I have written to complain but so far, no response. What can I do?

BT

A A&L says it makes a standard ?60 charge for letters of reference, which are normally requested by third parties, such as mortgage lenders. The third party is responsible for paying the fee for the letter.

Where the mortgage lender is the third party, it is routine for the fee to be added to the mortgage and then paid out of it, which happens pretty much instantaneously, so the borrower would never notice it.

However, in this case you are the third party and as you obviously weren't aware of the charge and so didn't automatically send the fee to A&L, it automatically added the charge to your mortgage.

The bank should have told you about the charge for the service in the first place, and you should certainly have had a letter from it requesting the fee before it was added to your loan.

The bank now admits the charge should not have been added to your mortgage account and has refunded it. By way of apology it has also credited a further ?60 to your account to compensate you for any phone calls or letters you have had to send to correct the error.