Concerns have been voiced about how fair this increase actually is, as it has left a good number of consumers with charges far higher than they had expected to pay.
Lenders will have until the 28 February to decide which measure they will adopt regarding their current customers whether this is charging the original one, a revised one, their current increased one or nothing at all.
Clive Briault, managing director of retail markets for the FSA commented: We expect these measures, agreed with the Council of Mortgage Lenders, will stop borrowers from being surprised by unexpected increases in these fees.
People will 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.
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The FSA is unlikely to further investigate a lender who adopts the first or the last option, however those who adopt either of the middle two will have to justify their position.
The FSA also expects lenders to treat any past customers complaining about the level of fee they paid in the same way as they will be treating comparable current customers.
This official view is welcomed by the head of mortgages at moneyfacts.co.uk, Darren Cook, who comments: This is good news for the consumer it certainly wasnt right that you were expected to sign up to agree to pay an unknown fee at a future date. We welcome the move by the FSA to introduce greater transparency in this area.
Most consumers are agreeable to paying fees if they are able to see a return, for example by way of a lower rate, but exit fees have offered no tangible benefit and have often been tucked away within the small print of the application, leaving many completely oblivious to their future obligation.
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