en-us http://backend.userland.com/rss Your Friends @ Myvesta.org.uk (stever@myvesta.org) myvestaukblog_archive.html stever@myvesta.org 114312072236595746 Alliance & Leicester is at it again with sneaky mortgage fees. Mortgage rates have been crunched so low that most lenders are now clawing back costs through ramping up their front-end and back-end fees, but some simply defy belief.

My colleague Jo Thornhill, who also writes for Financial Mail, has recently become the proud owner of a flat in south east London. She applied for one of the best mortgage deals on the market, which was with Alliance & Leicester.

When the mortgage offer came through, like any decent financial journalist worth her salt, Jo checked it thoroughly, including what fees were being charged and for what. One £25 fee related to a charge A&L applies to customers who do not take out its buildings insurance.

The administration fee is charged to cover the administration cost for the lender to ensure insurance is in place. Fair enough, Jo thought, until she called A&L's insurance division to get a quote for cover. The thinking was if A&L could provide competitively priced insurance Jo might save herself a needless £25 charge.

However, she was shocked and annoyed to learn on speaking to a member of staff at A&L that the bank does not provide buildings cover for flats. After much wrangling the bank waived the fee on Jo's mortgage account saying it was a mistake. But surely A&L's computer systems should have a default function which means this fee never shows up on the purchase of flats? How many other people have bought a flat using an A&L mortgage and been unknowingly charged this fee? Let us know (or about other mortgage fee problems) by posting a comment.

Richard Dyson, Financial Mail