What can I do about costly mortgage exit fees?

Q I am in the process of moving my mortgage from Alliance and Leicester to Nationwide.

When I last moved my mortgage from Halifax to Alliance & Leicester, Halifax charged £125 in administrative fees.

Alliance & Leicester have charged £295 to release the deeds and other costs. This seems to me to be an exorbitant charge, designed largely to punish remortgagers and discourage their customers from seeking competitive deals elsewhere.

Are they allowed to charge whatever they like? If not, how can I seek redress?
FB

A You are not alone in thinking that exit fees are exorbitant. The Financial Services Authority (FSA) is also concerned that these fees are being set at an unfairly high level and has asked lenders to justify the calculations behind recent, and quite dramatic, increases in exit fees.

And yes, lenders can currently charge what they like but the FSA is also concerned that many lenders have unfair discretion to raise charges. Several commentators are urging the FSA to insist that lenders guarantee not to charge a borrower more than whatever the exit charge was when the mortgage was taken out, which is something that both Alliance & Leicester and Northern Rock now do.

Sadly the change of heart by Alliance & Leicester is for new customers only. But there is nothing to stop you from asking them to reduce the fee of £295 to £150, which according to Moneyfacts, is what it was set at five years ago. If they refuse, you can make a formal complaint to the lender and ultimately, if it is not resolved to your satisfaction, you can take your complaint to the Financial Ombudsman Service.