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Ive had an AEG condensing washer/dryer for just over a year now. The
problem with it is that whenever I use the dryer to dry clothes/towels
etc whenever it finishes they smell really bad, like a damp smell.
I have opened up the little cover at the bottom right to let any excess
water drain out, but to be honest, its only about half a glass full
that comes out.
When i wash items (using powder tablets and fabric conditioner) and
then fast spin, the clothes smell ok, quite a clean smell so its not
until i dry them that the problem arises.

Could it be a fault or is it just one of the drawbacks about using a
condensing dryer?
I used to have a vented dryer in my old house and never experienced
this.

Have you checked any filters on the washing outlet side?
Could be debris in them causing a smell that is exacerbated by the drying
process and the heat.

Also I have noticed there is a particular brand of soap powder on the market
that gives off a rather musty smell from the fabrics after being dried in a
tumble dryer.
Not sure which it is but it is quite noticeable.

Also you need to remember that whatever air is drawn in to the machine would
need to be clean(ish) so is there a filter for incoming air that needs a
clean assuming it's not drawing in from an area of dampness or rot somewhere
?