One Account rates cut

ALM

Hi everyone, I too am now a disgruntled customer of the One Account having been perfectly happy with the service provided by them over the past few years. Here are two responses I have received from them recently in response to my queries about review of interest rates:

Thank you for your email about the recent decrease with the Bank of England base rate. The One Account is a variable rate product and does not track the Bank of England Base Rate, nor is it linked to either the RBS or NatWest Standard Variable Rates. We use any changes in the Bank of England base rate to review One Account interest rates and I appreciate that you believe we should make a decision more quickly. In setting interest rates, we consider a wide range of factors including the cost of funding variable rate mortgages, which is currently significantly higher than the Bank of England Base Rate. At this time our interest rates remain under review and I have no further information, but I can assure you we will communicate any changes in line with the Terms and Conditions of your account

AND

I would like to make you aware that RBS announced they are reducing their standard variable rate by 1.5%. A Standard Variable rate is a follow on rate from a fixed or initially discounted rate. The One account is just a variable rate with no fixed or discounted periods. As such we are not linked to the bank of England base rate or RBS standard variable rate.

Yorkshire_Bred

woodam1963 wrote: »

First a confession: I spent more than 10 years working for Virgin Direct and Virgin Money and, while Marketing Director in 1997, I was heavily involved in both the product design and public / media launch of the Virgin One Account. Several years after leaving Virgin I remain a loyal One Account customer...though my loyalty has been stretched to breaking point in the past few weeks.

I have to say it's heart-breaking to read so many negative, yet to my mind almost entirely justified, comments about a once revolutionary mortgage product that we were so proud of at the time and which, for many years afterwords, genuinely represented the 'acceptable' face of UK financial services.

It beggars belief that any Bank would be comfortable treating its customers in the cavalier fashion that is so evident from the emails and phone calls related on this site. Given RBS's current predicament one would have thought that it would be particularly attuned to what its most valuable customers are saying, yet the opposite appears to be the case. Even a bit of basic, common sense customers communications would go an incredibly long way, yet they appear to have simply stuck their heads in the sand in the hope that all their aggrieved customers will get fed up of complaining. Not likely with £250 each and every month on a £200,000 mortgage at stake they won't.

Anyway, my apologies again for the part I played in the birth of this now much-maligned product - it really was never meant to end this way. I fully agree with those people who have decided to take their grievances to MP's, the media, the Ombudsman and any other available channel. As my own penance for having helped get us all into this mess in the first place I have started a Facebook campaign this evening:

DECAMP (Declaration by Enlightened Customers Against Mortgage Profiteering) .
Although it was very much inspired by my own recent experience with the One Account, I do hope it will become a useful resource and rallying point for all UK mortgage customers who are victims of bank profiteering and who are looking for an outlet for their questions and and frustrations. If you're on Facebook please sign up for the group...who knows where and when the tipping point might come when RBS finally sees sense on this!
Best of luck everyone!

Thank you for your post, I wonder if you would be able to clear up the question as to how this product was initially marketed in relation to how the interest rate would follow with the BOE base rate?

From what I now understand it seems there is going to be greater scrutiny of all the Banks T&C, especially so where they have failed to pass on any interest rate reductions on a SVR mortgage.

serendipity101

Hi, I have just written to my local councillors and my local MP.

I did this with the help of this website. it maybe useful to others who like me didn't know how to contact their local MP.
http://www.writetothem.com

And also joined DECAMP (Declaration by Enlightened Customers Against Mortgage Profiteering) on Facebook.

http://www.facebook.com/s.php?q=DECAMP+%28Declaration+by+Enlightened+Customers+Against+Mortgage+Profiteering&n=-1&k=400000000010&sf=r&init=q&sid=4ce771dc8b5be0af8b913c7fa83fd1ba#/group.php?gid=37369727715

malocao

Thanks to people who have posted OA's responses to complaints. Just to quote a couple of recent ones:

ALM wrote: »

The One Account is a variable rate product ... In setting interest rates, we consider a wide range of factors including the cost of funding variable rate mortgages, which is currently significantly higher than the Bank of England Base Rate.

AND

The One account is just a variable rate with no fixed or discounted periods. As such we are not linked to the bank of England base rate or RBS standard variable rate.

These answers are sadly incomplete.

What some readers may not know is that OA, as a division of a FSA-regulated firm, is now under a regulatory requirement to Treat Customers Fairly (TCF). This goes much wider than compliance with the contractual terms and, among other things, TCF means that OA can't do whatever they like with the interest rate. They must manage it consistently over time, and consistently between different borrowers.

For me, what happens on 1st Dec is the acid test. If they don't reduce all their rates by at least 1.5%, there will be an apparent breach of TCF. For reasons why, see my earlier post (#211) of a draft complaint letter.

Mattfoo

Blimey, looks like alot of effort is being put in with no results.

Why not just focus your effort in getting a new mortgage with another bank that actually tracks the BOE rate.

Why waste your own time and effort in trying to communicate to ... lets face it a complete brick wall.

I moved mortgages last month to First Direct after being a customer with Virgin One for several years. It was so simple and took no effort !

New Mortgage = Better Deal + Happy & Satisfied + Time spent with family and not wasting my own time writing to lists and lists of people complaining and getting angry.

Just Move. If you were not satisifed with a supermarkets customer service you would not shop there.

GeeGeeTea

Hi All,

I have been lurking around here for some time as a very-frustrated OA customer. Have already exhausted the OA email bank of set responses and have now forwarded them all on to the Rt Hon A Darling MP. I then told the OA that I had done so. Which prompted a 'ta very much' email.

I will join in on Monday for the big-push to Big Al.

malocao

Mattfoo wrote: »

Why not just focus your effort in getting a new mortgage with another bank that actually tracks the BOE rate.

Just Move. If you were not satisifed with a supermarkets customer service you would not shop there.

Matt,

Some of us probably will move from OA. But some of us can't, because of house price falls since we took the mortgage out, and/or because lenders are now much more restrictive on who can borrow & how much.

Seems that making lots of noise is the only chance for the second group to get fair treatment.

Cheers

musicegbdf

Thanks to Woodham 1963 for joining the discussion , I am sure his input will give great support in the campaign .
As I have mentioned in an earlier post I have a statement in a book called "The Essential Guide" given to me when I took out a OA that stated they would always aim to have an interest rate lower than the Halifax SVR. Whilst not a contractual commitment , I see this as a statement of intent. Others seem to have similar paperwork , but for different statements. What is claer is they must be in breach of FSA regs. Can they use the Interest rate to drive us all away and close down the product ? Is this allowed under FSA rules. can't think it can be...

I have now written to Alistar Darling, my MP , watchdog , and joined the "Which" campaign. I have never done anything like this before and feel that RBS must be disgraced. For my personal reason I cannot leave them until May next year, but will now very seriously do so and will avoid any RBS company in the future unless they come down out of the Ivory tower very soon

Mattfoo

malocao wrote: »

Matt,

Some of us probably will move from OA. But some of us can't, because of house price falls since we took the mortgage out, and/or because lenders are now much more restrictive on who can borrow & how much.

Seems that making lots of noise is the only chance for the second group to get fair treatment.

Cheers

Fair comment Malacao.

I suppose I feel everyones frustrations as an ex OA customer.
Good luck to the folks who cannot remortgage ! Im right behind you :T

Cheers Matt.

adeprit

Whats happened since this statement in the guardian

'The country's largest mortgage provider, Halifax, said it would pass on the full 1.5% rate cut to its customers, following hot on the heels of rivals Nationwide and Royal Bank of Scotland. Northern Rock, which was nationalised after its near collapse last year, will also reduce borrowing costs by the full 1.5%.
The cuts, which were welcomed by the prime minister, Gordon Brown, follow pressure from the government for lenders to reduce mortgage costs following yesterday's shock 1.5% reduction in the Bank of England base rate.'