Nationwide won't let me pay the penalty and change products!

Inactive

All of this is assuming interest rates do not shoot up again.:rolleyes:

Bummins

They will do anything they can to prevent you from moving off higher rate products

Inactive wrote: »

All of this is assuming interest rates do not shoot up again.:rolleyes:

pfff, complex me thinks... The news last night mentioned some university professors studying recessions, and they noted that from the official start, it took 2 years on average to come out of one, and 6 years for property prices to show signs of positive recovery.

Gorgeous_George

If you had wanted a fixed rate in the first place, what has changed to make you think a tracker would be better. However unlikely, rates could rise again.

I guess your LTV is not good enough to qualify for any other Nationwiode product. Otherwise, I don't think they would stop you paying the early repayment fee. If your LTV is ok, move to another lender.

GG

energy80s

I'm in a similar position in that I took out a fixed rate mortgage with the NW in October - a few days before the rates started to crash! I'm stuck on 6.08% and was thinking of fixing again with them at 4.98% if I pay a 2% penalty. I would be very !!!!ed off of they didn't let me switch and would have no hesitation in dropping them like a hot potato! I'm waiting on rates dropping a bit further and then I'll see about another re-mortgage.

Anon

energy80s wrote: »

I'm in a similar position in that I took out a fixed rate mortgage with the NW in October - a few days before the rates started to crash! I'm stuck on 6.08% and was thinking of fixing again with them at 4.98% if I pay a 2% penalty. I would be very !!!!ed off of they didn't let me switch and would have no hesitation in dropping them like a hot potato! I'm waiting on rates dropping a bit further and then I'll see about another re-mortgage.

Why would you fix again at 4.98% in the current market (if you are going to get hit with the 2% penalty)?

In answer to Gorgeous George, in my circumstances, the fix looked good last December/January when we took out the mortgage and was competitive to the market and most SVRs which were actually rising at the time. Now, the market has completely changed. It may make sense to take the penalty hit and switch to a base rate tracker off-set as that could mean significantly reducing the term of the loan and paying it off much earlier, as savings at the moment are not that competitive and we may as well pay in there rather than pay the £6,000+ per year in interest on the loan to Nationwide. For First Direct, there is a £799 arrangement fee and valuation costs to consider as well, but even if/when the rates rise, they would have to rise around 2% to be paying more than I am now (and no exit fee apparently).

The One Account website does an interesting illustration to demonstrate what the effect may be on offsetting based on current income and expenditure - their current rate is around 4.2%).

Anon

tonydee

Very topical subject for ourselves too as we've been deliberating on whether it was worth switching our current fixed 5.18% mortgage to a better deal and taking the penalty.

It would seem that this is not as easy as we think so in all cases like this I would strongly advise seeking professional advice.

My head says we had it good for a long while at 5.18% so take the next 12/18 months as a hit as historically 5.18% is very reasonable.

minimike2

Sounds like a blessing in disguise. You will thank them when rates start to go up again. Thats why you took a fixed in the first place, right?

MarkyMarkD

Gorgeous_George wrote: »

If you had wanted a fixed rate in the first place, what has changed to make you think a tracker would be better. However unlikely, rates could rise again.

I guess your LTV is not good enough to qualify for any other Nationwiode product. Otherwise, I don't think they would stop you paying the early repayment fee. If your LTV is ok, move to another lender.

GG

I think your guess is wrong, GG, based on what the various earlier posts have stated.

As a general rule, no lender is obliged to allow a customer to switch products. Many lender's Ts & Cs (KFIs etc) don't even mention product switches - they simply state that ERCs payable on redemption (part or whole). But it is generally accepted that ERCs are also payable if you ask them to switch products and they consent.

It is commercially ridiculous for any lender to allow a borrower to pay a 3% ERC and to switch to a different fixed rate which is (say) 2% cheaper for 3 years. Whilst in the past when few people had the nous to do so, lenders would have let them, lenders are now VERY conscious that they have a book of borrowers paying rates far higher than current rates for whom paying the ERC seems like a good deal. In fact, that's because the ERC was set way below the real cost to the lender of borrowers exiting early in circumstances like prevail today.

So, I wouldn't expect any lender to let you out of a deal onto a new deal (or their SVR or tracker revert rate) even subject to an ERC, simply because they have no obligation to do so. It's better for them to let you pay the ERC and walk away, than to let you have the new deal you are asking for, simply because many people will be deterred and simply stay where they are.

cj34

Fiesty - we all come on here for reassurance, there is no need to be so angry in your responses, I saw your other post stating ...

"You are clearly a person who gets some sort of kick from putting other people down. Yours energy would be better chanelled into building on your own self esteem, rather than making yourself feel good at the cost of others"

yet this is exactly what you are doing being so patronising to people who are merely asking advise.
If you can't be nice, don't post any replies!

cj34

Just checking on this subject again, when I originally rang Nationwide to change over products they told me it was not possible to do this over the phone I had to write in and do it (or I would have changed onto a tracker that day) I wrote in and phoned back it was in between this that they changed the terms so that I could no longer move from my fixed to the tracker, do I have any arguement that I was told it was ok but in between the 2 phone calls they changed the terms, I have had no response to my letter, is it worth following through?

Thanks for your help!