Tracker Mortgages - Can the banks do this???!!!

AdrianHi

Quote:
Originally Posted by AdrianHi
+.59% BoE base rate tracker with Abbey FlexiblePlus mortgage which I got into March 2008.
August 2007 T's & C's section 1.59 "tracking rate" says base rate plus the differential (.59%) or 0.0001% p.a. which ever is the higher.

That`s what I read in my booklet too and I have to admit I don`t understand what it means!

space_rider wrote: »

That`s what I read in my booklet too and I have to admit I don`t understand what it means!

Realstically it means you get BoE rate + your differential.
In my case todays bank of england rate 4.5% + 0.59% = 5.09%.
To get to the 0.0001% rate the bank of england rate would have to be negative, they pay you to take money but you do have to pay it back - :rotfl:

Debras_Angel

Ian_Griffiths_Halifax wrote: »

Do you have an Interest Only Mortgage or a Repayment Mortgage.

Repayment mortgage

If you have an Interest Only Mortgage and have paid lump sums off it or make regular overpayments, then you aren't reducing the term, you are simply going to owe less at the end of the Mortgage term.
N/A
In my post I was referring to the fact that people have come on here reporting that they have been charged admin fees for effectively reducing the term with every overpayment on a repayment mortgage.
N/A
Basically, as Rikki said, it's a case of check your terms and conditions, but these can still be confusing. You may as well call their customer services for clarification on your specific mortgage, but make sure that you log the date and time of your call and the name of the person you speak to.

Thanks Ian,

I got my mortgage through my friend who works at the Halifax and having gone through it all again today with a fine toothcomb, I only have the £175 repayment fee to pay. I do have the 3% level restriction but that doesn't bother me as the mortgage is low anyway.

I have been on to Halifax a few times lately concerning the interest I'm paying but never got a satisfactory answer, long story I won't bore you with it.

I am like a dog with a bone re my mortgage and keep a spreadsheet of all interest and payments per month.

Cheers

Debs

jimwillsher

BradfordBull, as the original poster in this thread did you get a solution? We seem to have the same mortgage, as I too have a "0.34 above base rate tracker for lifetime of mortgage" with IF. I too have gone through the fine print but cannot find anything.

I took out my mortgage in September 2007, and my previous one was also with IF.

Historically, I find that interest rate cuts with IF don't take effect until AFTER the next payment. So for example, the 0.5% rate cut was on October 8th, and my payments go out on 5th. So my payments still show the old rate, and I expect to receive a letter sometime after 5th November giving me the new rate. But in the back of my mind is a fear that there's a lower-rate threshold, and that the tracker will stop tracking!

So, if you managed to find an answer on your IF mortgage I'd appreciate an insight.



Jim

wolvoman

http://www.thisismoney.co.uk/mortgages/article.html?in_article_id=456186&in_page_id=8&in_page_id=8

This article suggests IF trackers have no collar, but this is recent.
My IF mortgage was taken out in 2007 but there is no mention of a collar in the T&Cs (that I could find anyway).

disney_cjd

Also see here, lists who has collars and who does not.

http://www.dailymail.co.uk/money/article-1079493/Collars-choke-bigger-mortgage-cuts.html

krrcwl

I was lucky enough to get one of the last base-rate - 0.26% tracker deals from Abbey last year, and previous drops in Feb and Apr have been passed on promptly. But I noticed my payment this month has not dropped after last month's drop to 4.5% - no question of reaching the collar in this case. Can they do this? They are suppose to track the base rate on a day-to-day basis.

And now another 1.5%, which would bring my rate to 2.74% - I haven't checked the paperwork yet, but I guess that will be pegged to the 3% collar.

Should I get on the blower?

jtlowrey

Rikki wrote: »

Lets get to 2.5% base rate before we start worrying. It could never happen.

Well, it just about has now!

I'm on an A&L lifetime tracker now at BoE + 0.99% (having been on a 2yr fixed 4.39%). Been through my T&Cs and can't find any 'bottom' rate or 'collar'. Also reading the two articles posted about it seem Santander (Abbey and A&L) only collar at a nominal 0.001% even though I haven't found this rate anywhere.

I've very pleased obviously

ScoobyZ

Mr_Kennedy wrote: »

Nationwide is 2.75%

I'm on a tracker with this so any drops below 2.75% I will be paying 2.99% (BOE +0.24) Although have another 2 years on this to go so not complaining.

So today on 3.24% (after 1.5% drop)

Anyother 0.25% drop will put me on 2.99%

If it goes to 1% boe I will still be on 2.99%....gulp which although unlikely to happen will be 3xBOE rat

krrcwl

But can Abbey delay this? As far as I'm aware a tracker is suppose to track, not change when they feel like it.

jtlowrey

krrcwl wrote: »

But can Abbey delay this? As far as I'm aware a tracker is suppose to track, not change when they feel like it.

No if its a Bank of England (BoE) tracker then it will come down. There is not an option, just this 'collar' issue at a certian level.

My T&Cs state that "if the interest rate cut comes 7 days before the month then that rate will apply" i.e it hasn't come in time for november, so for me 3% + 0.99% = 3.99% will apply in December.