Nationwide: No More Rate Cuts

chewmylegoff

amcluesent wrote: »

They should be MADE to pass on the rate cuts to hard-working families.

what about families who work at just an average level of intensity?

[Deleted User]

I don't work very hard but I get paid reasonably well. Do I deserve less than 'hard working low paid families' ?

How about 'productive' families?

Cat695

Well i think its the right thing.....this way savers (people who are more likely to spend cash and therefore help in a recession) aren't getting completely dry bummed.

chucky

amcluesent wrote: »

Nationwide Building Society will not pass on any further interest rate cuts to the majority of its tracker mortgage customers.

The lender plans to invoke a clause in the deals enabling it to stop reducing the loans in line with cuts to the Bank of England base rate once official interest rates fall below 2%.

They should be MADE to pass on the rate cuts to hard-working families.

it's in the contract unfortunately.

why should they be MADE to pass on the rate cuts if it's what they signed up for!?

alared

amcluesent wrote: »

They should be MADE to pass on the rate cuts to hard-working families.

No they shouldn`t.

What about the hard-working SAVERS who supply the money for the mortgages.

Why should they get peanuts for their savings because mortgage payers have bitten off more than they can chew and don`t want pay the going rate.

You`ve all had it cushy with low interest rates of around 5% for the past few years.

I don`t know how you would go on if rates went back to 15%, then you`d really have something to cry about.

WTF?_2

feisty1 wrote: »

Just because bank of England rates have dropped doesn't necessarily mean that Natgionwide are buying their money at that BoE base rate. We have seen the consequences of lending too much money at too low a rate. As of yet, Nationwide have not been "bailed out". Are you seriously suggesting that Nationwide should continue to lend in a reckless way by making losses that will require even bigger taxpayer bailouts? Cutting rates further to make a loss would be a pretty reckess action for any lender to take.

Yes, this is the thing.

Time was when real world interest rates were quite closely linked to the one that the govt/central bank sets.

These days, the IR figures coming out of the BoE are about as relevant to real life as fairy tales. The real cost of borrowing money is much, much higher even for the banks. Or maybe, especially for the banks seeing as they're in such dire straits.

The way I see it ending up is the government ending up printing large amounts of money and handing it to the nationalised banks to distribute. Sort of like Bernanke's "money from a helicopter" idea but with the twist that you are borrowing it and thus dependent on the government's largesse. A real dream for any politician but hog heaven for our gang of neo-socialists.

In the meantime, given the true costs of borrowing money for the banks there is no way that they can give it away at rates of interest anything like those that the Western Central Banks are proposing. On top of that, by slashing rates offered to savers they aren't going to attract the capital that they need from depositors. It's an absolutely bonkers position that the government is putting the banks in (not that they aren't responsible for creating the mess themselves, of course).

WTF?_2

MRSTITTLEMOUSE wrote: »

After all it's business and if you signed up for it knowingly,it's fair.
We can't have it both ways.

Of course you can - this is modern day Britain. It's your entitlement to be rescued from any bad/ unfavourable financial decision you made because someone in authority should have been around to prevent you from doing it.

And you should get some compensation for your trouble. :cool:

Gorgeous_George

There's no luck involved. I chose trackers for my mortgages to benefit from falling rates and to pay a fair rate at other times. I took the risk that rates might rise. My lenders took the risk that rates might fall.

Of course, I understand the dilemma that the banks have got themselves into. They allowed too many people to place their bets on trackers. Now that rates are extraordinarily low, the lenders have managed to back themselves into a corner. They can either:

1. Increase SVRs to compensate for the large number of borrowers on trackers.
2. Decrease rates on savings accounts to fund the trackers.
3. Invoke collars (at the risk of upsetting those on trackers and the OFT)

Not an easy choice. Whatever they do will be seen as unfair by one or more groups of customers.

My mortgages are currently 2.89% and 2.74% - neither have collars and are not with Nationwide (NatWest BTL and Britannia respectively). I'd be happy to stick at that or, possibly, a little higher however, I'd want something in return. If my lender offered to cap my tracker at 6% or paid me to buy a collar, I'd accept a collar at 2%. At the very least this would buy the bank more time but they should not have exposed themselves to this risk in the first place.

GG

mvengemvenge

Kez100 wrote: »

Nationwide never had any money.

No, I meant the banks generally. Sorry for not making that clear.

feisty1

!!!!!!? wrote: »

The way I see it ending up is the government ending up printing large amounts of money and handing it to the nationalised banks to distribute. .

Their is nothing surer, we will see this happening.........