Maintenance and transaction fees on accounts linked to other banking products

Linked bank accounts are accounts held to pay the instalments of a loan, such as a mortgage, or to receive the interest from a time deposit.

The question is whether the lender can charge you maintenance fees on this account. The answer will depend on when the loan or deposit was taken out, as new consumer protection regulations came into force in April 2012.

There are two different scenarios:

• For those loans or deposits taken out before April 2012, and so subject to more limited consumer protection, the Banco de España’s rule is that the bank cannot charge maintenance fees if the account is used exclusively to provide services relating to the mortgage loan or term deposit, i.e. to make mortgage repayments or to receive interest from the time deposit.

It should also be possible to make other payments or direct debits related to the mortgage or deposit free of charge, such as paying insurance linked to the mortgage loan. However, if the account is also used for other purposes (cash withdrawals, paying taxes or other unrelated direct debits, etc.), the lender may charge the corresponding fee.

• If the loan or deposit was taken out after April 2012 the new regulations have changed the criterion such the credit institution may charge maintenance fees if certain requirements are met to ensure broader consumer protection:
  • The bank must inform customers taking out a loan or deposit about the requirement to take out a linked account and its cost.
  • The account’s cost must be included when calculating the Annual Percentage Rate (APR), as this rate is what will allow consumers to compare the deposit’s return or the loan’s total cost.
  • The lender may not raise the fees charged during the lifetime of the mortgage loan or term deposit.