Legal fees added to mortgage account?

L

Loreal

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Gotten into huge arrears over the years with mortgage (kbc bank). Trying to rectify things with them at the moment and they have charged me their 6k legal fees even though I was never brought to court etc. I am looking to capitalise on my arrears currently as in a better financial position but can I do anything about reducing the costs associated with going into arrears to begin with?
 
They can't do that.

Did they say it would cost 6k to take proceedings?
 
This is actually the fees they charged a couple of years ago when they were considering reposession but it never went to court, I only ever got letters stating they were going to bring me to court. Luckily I got a job and started paying back the mortgage and some of teh arrears so they are now allowing capitalisation but the 6k of their legal fees has me a bit confused.
 
They can't just lob on 6k because they were thinking of taking you to court.

They did have to advise that fees would be added if they did actually go to court.
 
While going to court means extra legal costs there are costs before this. Just hiring lawyers to deal with debtors cost the bank money. Banks have always made the borrowers pay in those circumstances. They used to even have a price per letter. If it cost the bank 6K to chase Loreal then surely they can recoup this cost. On what basis do you think they are not entited to charge her? Maybe they forced her as part of the settlement to sign a document agreeing to this cost.

(I am not debating the merits of whether they should or should not charge her the 6k)
 
She would have agreed to the bank being able to make these charges in the original contract that was signed. You know the one that says in large letters that your home may be at risk if you do not keep up repayments.
 
She would have agreed to the bank being able to make these charges in the original contract that was signed. You know the one that says in large letters that your home may be at risk if you do not keep up repayments.
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Not necessarily. This is not a standard practise across all banks. In fact it is quite unusual in my exoperience where proceedings have not resulted in Court action. There is a grey area on whether such collection fees can be legally charged to the client account. Check the loan agreement and write to the Bank requesting a copy of their authority to charge these fees to the account. For 6K it would also be worthwhile employing a solicitor to write a letter if you get no satisfaction!
 
Thank you 44brendan. I will pen a letter to them this evening about this and see what they come back to me with.
 
I was on the phone to them about something else so queried this too. Apparently they have to get back to me as the guy who works in the legal department had no idea what the bill was for! I am hoping that this was some kind of error and that it is to be fixed. I presume they will just override it on their system so it comes off my mortgage itself?
 
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