Dont let Mortgage Express Con You Out Of The Full 1% Base Rate Fall

Signalbox

Hi,

I have a Mortgage Express mortgage which has until now directly tracked the Bank of England Base Rate (although it is described as on their Product Variable Rate). This month instead of getting the full 1% fall they awarded me 0.26%. When I called they said they can do that (which seems standard), however the information on their own promotional materials and website indicated otherwise. Here is a copy of my letter, I urge you to pen one yourselves.

Mortgage Express
Complaints Department
1 Providence Place
Skipton
North Yorkshire
BD23 2HL

Dear Sir/Madame,

I right to request my rate be adjusted in line with the full 1% Bank of England Base rate full in line with the information conveyed on your website and other promotions, not the 0.26% actually applied.

Having spoken with your staff on your call line number 0870 601 3220 at _____ on the _________ I have been told I am on Mortgage Express’s product variable rate. I have also had it confirmed in the same call that whilst it may be at times referred to as standard variable rate and variable rate they are all in fact the same rate. It was also confirmed that no different rate applies due to my mortgage being purchased by Mortgage Express From GMAC.

I reconfirmed these facts in a second call to ______ on the same number at ________.

As you will see from the attached screen prints from your own website dated 14/10/2008, it clearly stated that:

“All our rates are linked to the Bank of England base rate.”

The basis of my complaint is two fold.

Firstly that you state that your rates are linked to the Bank of England rate where in fact they are linked to your own need for a margin over the cost of the original funds lent to your company. Your rate structure is in fact a standard variable rate and you have no legitimate right to state a link to the Bank of England base rate. To state a link to any rate index implies a direct correlation. As you have decided to only award 0.26% of a 1% fall it highlights this is false and misleading advertising.

The second part of my complaint is in relation to the same website page and other promotional material, in that you claim:

“Product variable rates are always charged at a set margin over the Bank of England base rate eg base rate plus 1.5%.”

Whilst you only give an example and not the actual set margin, this statement again implies your rate structure is of tracker in nature not the standard variable rate it is in reality. The use of the word “set” is highly misleading and a short thumb through any English dictionary will show in this context set implies fixed, consistent, pre defined. Your margin is in no way set as you have demonstrated it is in fact a variable margin on which you decide based on your commercial needs.

When a financial adviser explains to a client that their rate will be a “set margin” the client is quite right to assume as your example on 1.5% over B.O,E base illustrated that that will be the given margin ad infinitum.

Being a financial adviser I have used your products, viewed your promotional material for many years and this statement wording has been common place. You have for years been deliberately misleading new clients and existing clients as to the true nature of the product, passing of a standard variable rate as a tracker in all but name.

I request your rates be corrected in line with your promotional material and the full rate changed passed on. I fully intend to make the regulator ware of this issue under their responsibility to monitor financial promotion and customer informations.

I expect written confirmation of receipt of this claim within 7 working days.


Yours sincerely,

luckyfool

From reading your post it appears that your mortgage was taken out with Gmac, and hence the rate will be governed by whatever your contract/mortgage offer with Gmac said (unless you have since switched onto a new contract/product with Mortgage Express).

mummytofour

GMAC used the libor rate so if you are still on the same product as you were the chances are you are on the Libor rate which is NOT the same as BofE rate.

RainMaker_2

Signalbox wrote: »

Hi,

I have a Mortgage Express mortgage which has until now directly tracked the Bank of England Base Rate (although it is described as on their Product Variable Rate). This month instead of getting the full 1% fall they awarded me 0.26%.

I have 3 BTL mortgages with Mortgage Express, recently coming off fixed rates and reverting to their Product Variable Rate (PVR). The PVR rate is specifically set at X % above BOE base rate, no if's, no but's. Essentially it's a tracker, in my case 2 mortgages at +1.75% and 1 mortgage at +1.5%. All the above being written into the original mortgage agreement, and needless to say my payable rates have indeed tracked to BOE rate.

Regardless of who assumed your mortgage (GMAC ?) the original mortgage agreement still stands. How exactly is PVR defined in the original agreement ?

illgetthere

i received a 0.16% cut but am on an ex gmac mortgage. i am on their svr. is that the same as a pvr?

mekj

It would appear that even though ex GMAC clients have since taken out a Mortgage Express product they are not on their PVR/SVR as advertised in all their literature (ie a fixed amount above BoE bank rate). They also use a floating SVR which they determine and apply.

luckyfool wrote: »

From reading your post it appears that your mortgage was taken out with Gmac, and hence the rate will be governed by whatever your contract/mortgage offer with Gmac said (unless you have since switched onto a new contract/product with Mortgage Express).

luckyfool

RainMaker wrote: »

I have 3 BTL mortgages with Mortgage Express, recently coming off fixed rates and reverting to their Product Variable Rate (PVR). The PVR rate is specifically set at X % above BOE base rate, no if's, no but's. Essentially it's a tracker, in my case 2 mortgages at +1.75% and 1 mortgage at +1.5%. All the above being written into the original mortgage agreement, and needless to say my payable rates have indeed tracked to BOE rate.

Regardless of who assumed your mortgage (GMAC ?) the original mortgage agreement still stands. How exactly is PVR defined in the original agreement ?

The original OP's mortgage was taken out with Gmac, not with Mortgage Express.

illgetthere

can you not discuss this with them over the phone? i might give it a go.. cant hurt i suppose

Signalbox

In relation to what variable rate ex GMAC mortgages are linked to I would have thought the same as many that there may be some tie to the original GMAC terms. However several conversations with Mortgage Express (GMAC Dept) have confirmed that they have one product variable rate applicable to all mortgages administered through Mortgage Express on which and discounts are calculated.

Acording to Mortgage Express staff it makes no difference, your discount rate if you have one is calculated on their product variable rate. You just have to ring a slightly different department to get information on your mortgage.

I suppose the acid test is if anyone has a true Mortgage Express residential mortgage, did you just get the full 1% or the lousy .26%?

Signalbox

On a side note GMAC's terms specifically allow the transferee to change the method of calculating interest provided it does not materially increase your obligation over that of the original contract. EG switch from GMAC SVR to Mortgage Express PVR.

Usury_up_and_wear_it_out

All mortgages should be fixed by the government at 2% = end of recession and return to stability, 2% is fair and manageable.