Mortgage repayments and additional charges

[funkylad20]

I have recently completed a Transfer of Equity on our mortgage, of which the lender has charged a fee of £150, which they are adding to the overall loan. Does anybody know how I can work out the interest that we will be charged on this? I know it will be based on the repayment period (c.32 years left) and the interest rate (approximately 3.5%), but cannot figure out for this particular £150 addition on its own...

[bednobs]

it's pointless anyway, unless you are on a 32 year fixed rate!

[funkylad20]

It isn't pointless when we are being reimbursed the £150 due to the lenders extensive inefficiency and I want to argue the point that they can reimburse us it into our account BUT it has been added to the mortgage and therefore will accrue interest ;o)

[carrot99]

http://money.guardian...orm/0,,603119,00.html

according to this you'd pay the £150 plus £99.56 interest

[bednobs]

yes but if they are going to reimburse tou, they are not going to give you 32 years interest too are they? have i misread your question?

[carrot99]

I think funkylad is saying that he is getting the £150 reimbursed but because the £150 has been added to the mortgage debt he'll pay back £250 with interest so will be c£99 out of pocket.

[carrot99]

so if they pay him £150 cash he should pay it straight to the mortgage lender......

[bednobs]

sorry carrot still don't get it - if he is being re-imbursed why is £150 getting added to the debt?

[funkylad20]

Well this is where I am getting mightily confused too. Basically, we are being charged the standard fee of £150 to do the Transfer of Equity on the mortgage. Fair enough. However we have been waiting over six months for this and had many issues with Santander, which has finally been resolved. I consequently complained about the fact that they were going to charge this standard £150 charge for what I deem to be an incredibly poor service, which they agreed was wrong and will reimburse us £150 cash into our current account. There is no way they can take the already charged £150 off the mortgage because the final figures have gone through solicitors etc., so the bank reimbursement is the only option. My point is, being charged £150 = £150 cash back is balanced, BUT surely we will be charged extensive interest on the £150 added to our mortgage, so we are still out of pocket as the mortgage owed is slightly increased now. Or have I got that incorrect?