Nationwide "Collar" Clause

GeorgeL

You are totally correct. I searched high and low for a Nationwide announcement, both on their site and vairous other good finacial sites. I have been unable to find anything to back up the letter they have sent me that indicates another cut. So I'm going to keep quiet for now.

brixham

Yep got my letter of interest drop yesterday and collar is mentioned in my Key Facts so will keep quiet and wait and see

MarkyMarkD

Nationwide have been a shambles over this whole subject. They should have simply stated, at the outset, that their collar was clearly documented and legally binding.

Faffing about as they have done is unhelpful to everybody.

grazer

WHAT!?!?!?!

"Fantastically Fervent MoneySaving Super Fan" MarkyMark wishes the Nationwide had not passed on the temporary reduction in their collar?!?!?

The one that allowed their tracker customers, including myself, to benefit from the full 1% rate cut in January?!?!?

Thats a massive amount to me right now.

I'm glad they reduced the collar, I'm glad for every penny off my mortgage now - because when the interest rates rise again who knows where they will stop given the state of things?

So I personally I don't EXPECT any collar reductions, but I do WELCOME them - I just wish we knew if this one was real or not!

MarkyMarkD

Yep, I wish that Nationwide had given that 1% to their savers, most of whom need the money a lot more than people who are getting their interest rate reduced from say 4% to 3%.

Most people with mortgages are NOT in financial difficulty. Most of them took out their mortgages with rates like 5%, 6% or even more. Paying 4% is great for them. Paying 3%, at the expense of old people who rely on their savings income to live, is simply ridiculous.

People need to recognise that money doesn't grow on trees. Every pound Nationwide - as a mutual - gives to its mortgage borrowers (which they are not contractually entitled to) is a pound they are stealing from Nationwide's savers. That's morally not right, and that's why I wish they hadn't done it.

But it's typical of Nationwide's limp-wristed approach to the government and the fact that they put the more vociferous mortgage borrowers ahead of the army of generally more quieter and compliant savers, most of whom (or at least most of those with the big balances of whom) are relatively elderly.

grazer

You cant make general statements like that "most savers need the money a lot more than people saving 1% on their mortgage".

It is also very unfair to paint mortgage borrowers as 'vociferous' while claiming that on the other hand is an 'army of generally more quieter and compliant savers' (I'd say you were quite a vociferous saver MarkyMark given your harsh opinions on borrowers)

I can't afford to save much each month - my children and a recent drop in salary see to that. So I reject totally your claim that people with a mortgage can't be in financial hardship. These drops in interest rate have been a huge blessing to me and my family, allowing us to chip away at our 30-year term by overpaying with the money we save.

I dont remember the 'mortgage best buys' advice on this very site stating 'select a tracker mortgage with a collar - the higher the better - as it will be much fairer on savers should the interest rate ever plummet'

Much of this site (along with its advice on thriftiness and prudence) is about making people think that money DOES sometimes grow on trees - be it money-off vouchers, cashbacks, exploiting loopholes, sneaky tricks to get money back or money off, switching suppliers, etc etc.

When the interest rate is high - savers with their big nest-eggs are laughing and some mortgage owners may have to eat beans on toast on a regular basis.

When interest rates are low - mortgage borrowers can make some inroads into paying off more of their loan, while savers suffer.

Thats life!

But the BOE decides that - not Nationwide and certainly not its customers (borrowers or savers). I applaud them for helping borrowers at this particular time.

p.s. I take it you dont have a Nationwide Tracker mortgage Marky??

lethal0r

read the t&c's fools. you wouldnt complain if it worked in your favour, why complain when it doesnt?

MarkyMarkD

I don't have a Nationwide tracker mortgage; I have a Woolwich tracker mortgage without a floor on the rate. But equally well I have savings which match the entire amount of my mortgage - so I am entirely neutral on the subject. I don't, as it happens, have any savings with Nationwide other than a fixed rate bond, so I'm not suffering as a result of Nationwide's actions. So I'm speaking without any element of self-interest, unlike most of those posting on this thread.

As lethal0r says, but putting it slightly more nicely ... there was a choice of base rate tracker mortgages with, and without, floors. Those who chose those with floors (if they were disclosed in the KFI, as Nationwide's were) have to accept the consequences of that. It is wrong to claim that it's unfair for Nationwide to enforce them, and equally wrong to claim that it's fair for Nationwide to FAIL to enforce them at the cost of their savers.

grazer

You aren't neutral - If you have a collar-free tracker mortgage with Woolwich, aren't you benefiting at the expense of Woolwich/Barclays savers in exactly the same way, albeit you knew from the outset that your mortgage would be unfair to savers if the interest rate dived?

Nationwide and Woolwich trackers must both now be on the same interest rate near enough - so any damage to savers at our respective banks must be the same? Just because my rate is unexpectedly low doesn't give you the right to preach about injustices between savings and mortgage rates if you are sitting enjoying an historically low rate too.

As I stated in my earlier post, I read my T&Cs and was fully aware and in agreement with the collar. I do not agree that any Nationwide tracker customer is entitled to expect the collar to be reduced.

But I am over the moon with our temporary collar reduction and thank Nationwide for helping tracker mortgage customers.

tartanterra

MarkyMarkD wrote: »

Yep, I wish that Nationwide had given that 1% to their savers, most of whom need the money a lot more than people who are getting their interest rate reduced from say 4% to 3%.

Most people with mortgages are NOT in financial difficulty. Most of them took out their mortgages with rates like 5%, 6% or even more. Paying 4% is great for them. Paying 3%, at the expense of old people who rely on their savings income to live, is simply ridiculous.

People need to recognise that money doesn't grow on trees. Every pound Nationwide - as a mutual - gives to its mortgage borrowers (which they are not contractually entitled to) is a pound they are stealing from Nationwide's savers. That's morally not right, and that's why I wish they hadn't done it.

But it's typical of Nationwide's limp-wristed approach to the government and the fact that they put the more vociferous mortgage borrowers ahead of the army of generally more quieter and compliant savers, most of whom (or at least most of those with the big balances of whom) are relatively elderly.

So, let's analyse this!

You reckon most people with mortgages (debt) are well off and savers (cash in the bank) are badly off!!!!!!!:rolleyes:

Pure comedy genius!!!!!!:rotfl: :rotfl: :rotfl: :rotfl:

What do you do for an encore!!!!!!!:rotfl: :rotfl: :rotfl: