Will cashing Abbey's cheque prejudice my compensation claim?

Q I am one of many people who has received a letter from Abbey National recently about compensation for mortgage holders affected by Abbey's dual SVRs. But my initial delight at the enclosed cheque was tempered when I looked at the terms and conditions that apply to the refund of excess mortgage payments.

Abbey has only offered me a refund from 27 June 2002, the date on which it received my letter. If Abbey National is obliged to refund excess mortgage payments I think it should be backdated to the date when the dual rate was first introduced. Am I correct?

Abbey says if I cash the cheque it will indicate my acceptance of the offer. Is it possible for me to cash the cheque without prejudice to my position if I wish to continue my case?
My only alternative, says Abbey, is to complain to the Financial Ombudsman.

I have not been able to check the exact terms of the ruling of the Financial Ombudsman because it has been posted as a pdf document on the web site and I do not have Acrobat installed on my home PC.

MT

A The Financial Ombudsman's ruling on this matter stated that while Abbey National was under no obligation to offer the lower of its tracker mortgage rates to existing borrowers, it should have done so, without penalty, when requested.

On that basis, compensation is payable only from the date on which individual borrowers complained, unless they enquired about the now defunct Classic rate when it was announced but before it went on sale in April 2001. In that case, compensation is payable from April last year.

The Ombudsman will be contacting affected Abbey customers shortly to check whether their case has been 'satisfactorily resolved' - by which it means it will be checking that the relevant refund of mortgage interest has been made.

So although you are clearly far from satisfied with the outcome, any increase in the amount of compensation being paid is highly unlikely. Your question about whether cashing the cheque might prejudice any further action is really an issue for your solicitor but I imagine that Abbey is correct in saying that cashing it would indicate acceptance of the offer.

Either way, I don't think you have a case to pursue - though you could confirm this with some legal advice.

And, incidentally, you can download the basic Adobe Acrobat reader for free from dozens of internet sites, including most government sites. Click here for more details.