Banks could face deluge of claims for variable rate mortgage chargesFriday, December 7, 2018
Banks could face a deluge of new compensation claims thanks to a campaign targeting mortgage customers who may have been overcharged.
Variable rate mortgage holders could be entitled to compensation
According to a Sky News report, ME Group, a specialist legal technology provider, will spearhead a move to encourage customers who took out standard variable rate (SVR) mortgages to check whether they may be eligible to a refund.
It is unclear how many mortgage holders could be affected by SVR overcharging but is estimated that the bill for banks could run to billions of pounds.
However, Sky News reports that both the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) had been alerted to the issue in recent months. In fact, it is understood that ME Group executives held talks with both the FCA and parliamentarians to highlight the potential for redress.
If the estimates are correct, this could be the largest compensation scandal since PPI, which is due to draw to a close in August 2019.
PPI refers to mis-sold Payment Protection Insurance policies that were often attached to mortgages, credit cards and loans.
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