End of fixed-rate mortgage

Treez58

I took out a 3-year fixed rate mortgage in February 2007 and in the key facts document it states that:

After the initial fixed rate, the rate which will apply for the remaining term of
the mortgage will be a variable rate, which is 2.19% above the Barclay
Bank plc Base Rate, currently 5.25%, to give a current rate payable of
7.44%.


Any rate change after the fixed rate period will take effect on the same day
as a change in the Barclays Bank plc Base Rate.


Later on in the document there is a section entitled 'What if interest rates go up?' which indicates how much the monthly payment would increase by for each percentage point increase in the variable rate.

As Barclays Bank plc Base Rate is currently at 0.5% this would give us a current interest rate of 2.69%. I have found nothing in the key facts document about a collar or minimum rate but I somehow believe that there must be a clause somewhere which is going to prevent this rate being applied at the end of the fixed-rate period and would just like to know if anybody has been in a similar situation and what the outcome has been.

firsttimetom

I havent been in a similar situation, but my understanding is that you will be entitled to the new 0.5% base rate.

I have heard some stories of people having trackers of about 0.9% below the base rate and are not paying any interest what so ever. However this is very rare.

wrenlegs

firsttimetom wrote: »

I havent been in a similar situation, but my understanding is that you will be entitled to the new 0.5% base rate.

I have heard some stories of people having trackers of about 0.9% below the base rate and are not paying any interest what so ever. However this is very rare.

Please read my thread above entitled 'OMG!!!' - I though itwould be 0.9% above SVR but it IS the base rate with the woolwich/barclays mortgages