20 Mar AFM confirms banks charged too much for switching mortgages
Banks might be forced to compensate consumers for excessively high punitive fees around mortgages. These fees were levied on customers when they wanted to switch their mortgage over to another bank, but the calculation of these fees have been too high
Back in July 2016 the AFM for the first time had the authority to control whether the fees which banks were levying unto their customers for switching from mortgage-products were too high, resulting in a negative verdict for Dutch banks: according to the Dutch tv-show Radar, which researches wrongdoing against consumers, banks were overcharging their customers 15% on average, resulting in an additional income of EUR 250 million for banks in The Netherlands. These developments caused ikbenfrits.nl to calculate the claim value for 26.500 cases, and compared the allowed fees with the actual fees paid by customers. The cases showed that consumers were paying an excess of EUR 3.020 per mortgage product above the agreements with the AFM in punitive fees to the banks. Today the AFM has confirmed these calculations and stated that banks must pay back the excessive fees to their customers, for fees paid from July 2016 onwards. Banks have already stated they will recalculate the fees customers have paid in relation to these products, in accordance with the statement from the AFM.
Following this development, ikbenfrits.nl has initiated a claiming procedure, called the “Oversluitclaim” against banks on behalf of Dutch consumers. The base of the claim follows the stipulations from the AFM, but goes one step further: consumers which have negatively affected by the fee structure before July 2016 should also be compensated. Together with the Consumentenbond, Ikbenfrits.nl will further investigate the payments made for switching mortgage products and review further possible legal actions.
More information about the claiming procedure can be found here.
Ikbenfrits.nl is a Dutch online mortgage advisor. Their calculations were made based on 26.500 cases within their own client base.