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Penalties for breaking 1 year fixed deposits
eeja
Posts: 374 Forumite
With interest rates dropping like a stone it makes good financial sense for those with 1 year fixed deposits expiring in the next 3/4 months to break those deposits and lock in to a current rate for a year before rates drop further as they are expected to....depending of course on the harshness or otherwise of the penalty levied for doing so.
Can I therefore ask readers what penalty their bank or building society would levy to get out of a fixed deposit early , in particular the best buy product up to last week and now the worst buy product Anglo Irish.
Can I therefore ask readers what penalty their bank or building society would levy to get out of a fixed deposit early , in particular the best buy product up to last week and now the worst buy product Anglo Irish.
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Comments
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See http://www.angloirishbank.co.uk/Personal_Savings/FAQ/FAQ_for_Fixed_Rate_Bond/#10in particular the best buy product up to last week and now the worst buy product Anglo Irish.0 -
Can I therefore ask readers what penalty their bank or building society would levy to get out of a fixed deposit early
It isnt standard across the board. Some will penalise with loss of interest whilst others wont let you access it early unless you die. If you think you need access to it then you dont put it in there. Perhaps use NS&I index linked certs instead.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Wow...now things are really getting interesting !
The faq link above states that for a one year fixed deposit, the penalty for early withdrawal is
wait for it...60 days interest .
On their website Condition 2 Terms & Conditions Fixed deposits it states :
''We reserve the right [ note its at the bank's discretion whether or not to charge a penalty] to charge an interest penalty equivalent to the foregone notice period on the amount withdrawn.[note; this must mean the period to maturity ] subject to a minimum £25 charge''.
So there we have it folks : if there's one month left to maturity and you want your cash is it a penalty of
two months interest or one months interest...big difference possibly thousands ????
Please advise.0 -
Don't know which Terms & Conditions you are looking at - the Fixed Rate Bond Ts & Cs, Para 4.1, say exactly the same as the FAQ posted earlier.Wow...now things are really getting interesting !
On their website Condition 2 Terms & Conditions Fixed deposits it states :
''We reserve the right [ note its at the bank's discretion whether or not to charge a penalty] to charge an interest penalty equivalent to the foregone notice period on the amount withdrawn.[note; this must mean the period to maturity ] subject to a minimum £25 charge''.0 -
Don't know which Terms & Conditions you are looking at - the Fixed Rate Bond Ts & Cs, Para 4.1, say exactly the same as the FAQ posted earlier.
Here you are :
http://www.angloirishbank.co.im/Personal_Savings/Privilege_Accounts/Terms_Conditions/TC-product.pdf
Amazing , different terms in Douglas than in Leicester !
If you want your funds back immediately with less than 2 months before maturity on a 1 year deposit you are better off in Douglas (offshore). If over 2 months to go you are better off placing the funds in Leicester (onshore) !! Crazy !0 -
That relates to the 'Privilege' Range (offshore) not the Anglo Irish (UK) standard fixed rate bond, to which my earlier links refer.0
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Why do you find it amazing that accounts in territories with different financial regulations have different T&Cs..?
Same bank. Can you think of a reason why the penalty clause in two British Isles subsidiaries of the same holding bank should be different ?
Dying to hear the explanation........please explain the logic .0
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