A Short Answer
In most of the cases mentioned below, yes.
The Supreme Court ruling only pertained to the jurisdiction of the Office of Fair Trade to decide if the overdraft charges were unfair or not.
Charges That Can Be Reclaimed
Charges that can be reclaimed or challenged are the following:
- Credit card fees
You can now file to reclaim these fees. Just make sure you read to the end of this article for the warnings and caveats.
- Mortgage Elevated Exit Fee
If you paid up your mortgage early within the last 3 years, there is a chance that you were unjustly charged a so-called elevated exit fee. If you were, then you can apply to reclaim it right now.
- Misrepresented Payment Protection Insurance
Some large banks have been caught selling payment protection insurance which was misrepresented when they were offered. These banks withheld the critical information that this insurance will only apply if you were out of work. These can also be reclaimed now.
The government has been especially good in ensuring that the public was properly warned about the bank charges and other unjust fees that were being applied with impunity.
However, there are some other warnings and caveats that must be kept in mind if you do decide to reclaim your bank charges.
Presence Of Unscrupulous Parties
Reclaiming the other bank charges is actually a simple matter since the government has made template letters available for download with the proper ready-made content
However, there are some unscrupulous parties that try to paint a picture that shows the process as a long and convoluted one. After doing so, they offer to do that for you and charge 20% of the total reclaimed.
It would be a very bad move to make use of such services due to a couple of reasons: one, to avail of such services, you have to hand over your personal bank records which are not only confidential but can also result in cases of identity theft or worse.
The other reason is what was stated earlier. That template letters abound on the Financial Ombudsman site and other sites. All that’s needed is to fill in the details and send it off to the bank in question.
The single biggest reason to stop someone in their tracks should they still be considering the use of such agencies is the fact that the Ministry of Justice has made it an offense for a company to offer to assist in the process of reclaiming bank charges.
Repercussions on Your Accounts
One must be aware that reclaiming charges can have some negative effects on the accounts in question. The banks have readied their responses to the expected deluge of requests for reclaiming so there may be a virtual minefield confronting the consumer. So read the following caveats to ensure that you are well prepared to reduce or eliminate such repercussions. Forewarned is forearmed.
Whilst the Supreme Court has issued rulings that will render a lot of the cases toothless as far as getting refunds is concerned, there are still those who may reclaim on the basis of financial hardship.
In this case, the bank in question may opt to close your account after processing the return of the charges made to your account.
It is important to be aware of these repercussions particularly if you have benefits coming into the bank account and you have some overdraft. It is possible that the bank will close your account and promptly deduct the overdrafts amount in full against your benefits. Moreover, even if there were no charges, the mere inconvenience of having the account closed can delay your receipt of your benefits.
So in order to avoid problems, it may be good to open an account with another bank and commence the transfer of your benefits prior to requesting the reclaiming of bank charges.
It is worthwhile to note that prior to the release of the decision on the test case, a number of banks released a no penalties current account which may be one of the better alternatives on the market.
Credit Card Fees
Like the banks, requesting reversal of credit card fees can end up with the credit card company cancelling your card.
Whilst this can be quite an inconvenience, a bigger problem may occur if you have a large balance with them. Once they close or cancel your card, the entire balance will suddenly be due. This can be a nightmare for the consumer who was hoping to regain a few pounds. It’s enough to stop the most determined client dead in their tracks if they have not prepared for this scenario.
So refuse to be bullied and intimidated into backing down from your request for reclaiming charges. Make some provisions for this expected and probable response.
You may want to prepare a cash advance to pay off the balance. There are many sources of loans available which may actually carry a lower interest rate.
Furthermore, if you definitely need a credit card then it’s time to look around and apply for one. So no matter what action the credit card company decides to take, you are ready to take it on.
Aside from the warnings mentioned, there have been numerous reported cases where attempts have been made to gain personal details or reclaim bank charges for very small fees.
These offers even make use of the Ministry of Justice, pretending to be part of it in order to gain your confidence and personal data. The proliferation of these and other scams have prompted the drafting of certain notices and other moves by the various government agencies to prevent people from falling for these schemes.
So to make it concise and clear, you and only you can reclaim the bank charges mentioned in this article. If you need further assistance, approach only government agencies and not private companies.
About the overdraft charges, there is still hope that they can be challenged. After all, as mentioned earlier, the ruling was all about jurisdiction and the nature of the overdraft charges. It had not mentioned anything about whether the charges are being excessive or not.
In fact, the head judge himself mentioned that the charges can be subject to scrutiny under the 1999 Unfair Terms in Consumer Contracts Regulations so there may still be a bit of hope on the horizon.