Why 10% of borrowers are screwed

michaels

BBC are quoting 50% of mortgages are fixed rate, 40% are trackers and 10% on or linked to svr.

For the banks the fixed rate mortgages are probably neutral to the BoE rate as the banks have secured the funds on a fixed rate themselves.

The tracker rates cost the banks a fortune as the base rate diverges from the libor rate leaving only one place where the banks can claw this money back - you guessed it - the 10% of borrowers on the svr. Even those not locked in by low/negative equity or discount deals have a lot less choice when shopping arround for a better deal - those locked in can expect to be shafted to pay for the windfall those on tracker rates are receiving.

Guess what I am in the 'screwed' camp - I paid HSBC a considerable sum to get on a special 'sale' discount deal which is now going to cost a lot more over the term than their standard tracker deal available at that time. I am wondering whether I can claim to have been miss sold on the basis that a product advertised as a special deal cheaper than their standard offering will actually cost a lot more - any thoughts?

feisty1

Why have you been mis sold????????...Check yr KFI section 2, which box is ticked, this will determine if you rcvd advice or information only.
You would have been asked a series of questions and depending on yr answers this would have resulted in the product you now have. Everyone wants a tracker now the rates have dropped, remember what goes down must go up, would you be saying mis sold when it started going up?

2. Which service are we providing you with?

¸

We recommend, having assessed your needs, that you take out this mortgage.
We are not recommending a particular mortgage for you. However, based on your answers to some questions, we are giving you information about this mortgage so that you can make your own choice

Jonbvn

michaels wrote: »

Guess what I am in the 'screwed' camp - I paid HSBC a considerable sum to get on a special 'sale' discount deal which is now going to cost a lot more over the term than their standard tracker deal available at that time. I am wondering whether I can claim to have been miss sold on the basis that a product advertised as a special deal cheaper than their standard offering will actually cost a lot more - any thoughts?

Nobody could have reasonably foreseen such a drastic rate cut, including HSBC. What has happened is that people on trackers have just been very lucky. You have not been so lucky. However, there is no basis for any legal claim.

Tiddler_2

A couple of months ago I bought some petrol from my local garage at £1.15.9 per litre, now the same garage is selling it at 94.9p per litre.

Can I claim the difference back as I believe I was missold the petrol !!

WestonDave

Its also worth pointing out that at one time earlier in the year HSBC were the only bank widely offering a decent deal to many coming off fixed rates - given a choice of being landed with 8% type SVR's back in the summer potentially leading to people falling behind on their payments, and being a bit off the absolute best now, it will still probably have been a wise choice to take HSBC's offer. HSBC may not come down as far as the best trackers but to be fair to them they were 1% above most of the time, whereas LloydsTSB's widely trumpeted full cut still leaves them 2% above base.

No-one can be on the market leading rate 24/7 - that is the nature of a competitive market - products are competitive for a while until a bank has sold as many as it wishes, and then someone else short of market share trumps it again to rebuild its share, and so the leap frogging goes on. Yes some people on -0.05 Trackers are looking very pleased with themselves right now, but I bet some of them were also checking their underpant supplies when talk was of base rates being shoved up to curb rampant inflation!

michaels

HSBC previously had a policy of keeping their svr within 1% of base. This promise was quietly dropped but their rate remained one of the most competitive. On asking about their rate I was told that there were no certainties but that I could look at what they had historically done...

The mortgage was sold as 'pay us a lot of money and you can go on a special rate more advantageous to you than our standard mortage range'. I paid them a lot of money and now find I am worse off than if I had chosen their standard product. I agreee that they could not have anticpated this but they also need to recognise that if they discriminate against some existing customers just because they can that they are hardly going to inspire repeat business.

feisty1

Maybe if you had consulted an independent advisor you could have had a better outcome

Broken electrics, send for the electrician
Nead a mortgage, let's do DIY

feisty1

sorry for the typo error

wharty

So many of these type of threads popping up now, i think its more of a miss-purchase than a miss-sell, people need to understand that they made the decision to buy a product at a certain price. They didnt have a gun held to the head, not one person could have predicted a 1.5% cut in interest rates, not even the mortgage advisers. You make decisions in life that are good and bad and you have to live with them, thats life.

space_rider

I don`t understand all the hate for those on trackers that gambled with interest rate rises but are lucky for NOW.

aqueoushumour01

people enter fixed rate mortgages to avoid interest rate risk - better off if rates rise and worse off if rates fall. bit silly IMO to expect compensation now that rates have fallen. mis-sold? what a lot of tosh