Abbey Home Saver 8%

kanchhelskis

dEAR PEOPLE FROM TODAY ABBEY HAVE LAUNCHED A 8% FIRST HOME SAVER YOU CAN SAVE FROM £100 TO £300 POUNDS A MONTH, MINIMUM INVESTMENT IS £100 POUNDS UP TO 5K, ONLY AVALIBLE TO PEPLE AGED 16 TO 35.

TOTAL MAXIUM ALLOWED FOR THIS ACCOUNT IS 50 K.

THINK THIS IS A GOOD ACCOUNT FOR FIRST TIME BUYERS.

kingmonkey

the saver must have an interview with an Abbey mortgage adviser, although the saver doesn't have to take out an Abbey mortgage

1 Eligibility
To be eligible for the First Home Saver (Special Issue 1), you must at the time of taking out the First Home Saver (Special Issue 1):
i. Be aged between 16 and 35 years of age.
ii. Be a non-home owner and first time buyer.
iii. Deposit between £100 and £5000 on account opening.
iv. Be able to credit between £100-£300 each month after account opening by standing order.
v. Agree to attend a full mortgage interview.
vi. Customers are only allowed to hold one First Home Saver

isofa

Just another reason not to use Abbey from my point of view. SHOUTING with matching spelling and grammar.

My personal reasons to avoid Abbey, include: atrocious customer service, the inability to get anything correct, empty apologies, rude staff...

apt

According to the Independent it's strictly limited to 5,000 new openings so probably more a publicity vehicle than anything else. It's only really of significant value to those under 35 with lots of money who have not bought a house and don't intend to for several years. Alternatively, it might be used by parents to give money to non-taxpaying children. £5,000 initial payment and £300 per month would rack up a reasonable amount of interest, but that would exceed the annual tax limits on gifts.

grebbo

How long does it last for ie how long can you keep paying in £300 for?

I presume they can reduce the 8% at anytime? They're not going to pay 8% if base rate is 2% in a few months time.

apt

The rate is variable. There isn't a time limit as far as I can see, but a limit of £50,000 which would be about ten years if interest is taken into account.

Milarky

apt wrote: »

The rate is variable. There isn't a time limit as far as I can see, but a limit of £50,000 which would be about ten years if interest is taken into account.

http://www.abbey.com/csgs/Satellite?c=GSProducto&cid=1210614769309&pagename=Abbey%2FGSProducto%2FGS_InfProducto

Norman-B

isofa wrote: »

Just another reason not to use Abbey from my point of view. SHOUTING with matching spelling and grammar.

My personal reasons to avoid Abbey, include: atrocious customer service, the inability to get anything correct, empty apologies, rude staff...

Oh dear! I pressed the 'Thanks' button in error, doh.

isofa, whilst I agree with your view re Abbeys poor customer service, I thought it a shame that you spoilt (in my opinion) your post with the comment about poor spelling etc. Was that really necessary?

theremarkablerocket

Hi guys,

D'you all think that this is just a gimmick, or would it actually be good for someone who fits the criteria? I'm 21 and want to start saving to buy a house in the next 5 or 10 years, and can afford to save around £150 a month for it, would this account be a good option or am I better off looking for a good fixed rate?

Cheers for your help.

ray123

It looks good in thoery but the fact that it is variable means that the rate can change at any time.
Mr Remakable rocket, I would advise that if you do go ahead, keep a close eye on interest rate.
A cash ISA is always worth considering as you do not pay tax on this (max £3600 per annum). Then if you find that you can afford more, perhaps set up a fixed rate regular saver for a year with a different provider. The rate will not be as good, but at least it will be fixed for a year.
Whatever you do, try and act quickly...

PremierFella_2

theremarkablerocket wrote: »

Hi guys,

D'you all think that this is just a gimmick, or would it actually be good for someone who fits the criteria? I'm 21 and want to start saving to buy a house in the next 5 or 10 years, and can afford to save around £150 a month for it, would this account be a good option or am I better off looking for a good fixed rate?

Cheers for your help.

It is pure guesswork as to whether this is a "gimmick" or not. There are many reasons for not saving with Abbey, but for this account these are minimised by the fact that you are effectively only dealing with them in person on three occasions (account opening, mortgage sale interview account closure).

If you meet their criteria, can put up with that sales interview, have a reasonable initial deposit to open the account and can keep a close eye on the interest rate (closing the account when it inevitably becomes uncompetitive), in your position I would seriously consider the account unless you are currently looking at a medium term fixed rate account for your existing savings (in which case the risk of missing out on a reasonable fixed rate now is more closely balanced against the rate on this Abbey account, which is variable and could easily be significantly cut within 12 months).

I guess an ideal scenario would be to wait and see what the rate on this account is after they reset rates in response to the 1.5% rate cut, but of course that would risk missing out on the account if they held the rate and made the account a closed issue.

Edit: ray123's advice is also very sound if you are not already saving in an ISA.