The Financial Services Authority (FSA) has warned mortgage lenders to treat customers fairly. In this economy there is the possibility of unfair practice and abuse of consumer trust and the FSA has vowed to look out for borrowers. One London based mortgage firm has come into their cross-hairs, Redstone Mortgage.

The FSA has fined Redstone Mortgage 630,000 pounds for failing to treat customers in financial difficulty in a fair and just manner. Most of the problems in dealing with customers occurred between 2007 and 2009. Their failings included failure to educate staff on how to fairly handle customers who were in arrears, using policies that led to unnecessary litigation in order to secure repayments and for sending "repetitive, excessive, and confusing correspondence" to their customers.

Redstone will repay 500,000 to customers who were charged excessive fees while in arrears.

The FSA lowered Redstone’s fine from 900,000 to 630,000 because they fully cooperated in the investigation.

Margaret Cole, FSA’s Director of Enforcement and Financial Crime said: "Many of Redstone’s customers were in a vulnerable position, having fallen into arrears on their mortgage payments, and firms should not charge such customers excessive and unfair fees. This is not how the FSA expects lenders to treat customers in arrears."

Borrowers are encouraged to report any unfair practice or treatment involving their mortgage or remortgage loans to the FSA. They are also encouraged to choose a lender or broker that is regulated or registered with the FSA as being approved to carry out functions related to customer mortgage and remortgage services.