Switched off

Q I have a very large mortgage, but because I am paid unusually and my mortgage company, GMAC, offers only three possible direct debit days per month, I have to pay by Switch card each month. GMAC charges me ?10 for each Switch payment, and says it is entitled to do so under its terms and conditions.

I had no choice but to accept GMAC as a lender and did not know when I accepted that this surcharge existed. I have complained, but to no avail. If GMAC offered direct debit payments on any day like most lenders, I could save ?120 a year.

I am tied to this lender - with significant early redemption charges - until February 2005.

JW

Actually, most lenders don't allow you to pay by direct debit on any day you choose - they generally have just three or four dates within the month which are acceptable.

Without seeing your mortgage contract I couldn't say for sure, but GMAC is probably correct when it says it can charge you for making your payments by Switch, rather than by direct debit. Retailers who accept payments by Switch have to pay a surcharge to the bank which issued the Switch card, while direct debit payments don't cost the retailer anything.

This charge should have been pointed out to you when you took out your mortgage, unless you originally arranged to pay by direct debit and then changed your mind.

The best you can do is ask GMAC to reschedule a direct debit payment date to accommodate you - but be aware that it is under no obligation to do so. Otherwise, I think you will have to reorganise your other bill payments to accommodate your mortgage.