Northern Rock

edited 30 November -1 at 1:00AM in Loans
6 replies 1.1K views
netlangnetlang Forumite
114 Posts
100 Posts
edited 30 November -1 at 1:00AM in Loans
Just applied for a loan with Northern Rock and the quoted 5.7% is not available. They get you filling in forms, press you for their insurance (which I refused) and on acceptance their rate went up to 8.9% - apparently they have their own internal method of working out your credit score. I am lucky enough to have an unblemished credit history so I believe the 5.7% is just marketing hype to get you caught in their net. When I queried this with them they said what they are doing is legal! (I did not at anytime query the legality of their decision just told them I was disappointed with their telephone advisor misleading me over their rate which resulted in me agreeing to go right through their full application process)

I have now decided to go with Nationwide at 6.4% which will allow me the flexibility to overpay the loan on a monthly basis without too much of a penalty (only £55 over the term of the loan). Or First Direct at 6.1% with no flexibility on overpayments.

Funnily enough a friend of mine also applied to Northern Rock yesterday and was offered the same rate as me.

Be careful out there.

Replies

  • asandwhenasandwhen Forumite
    1.4K Posts
    they have to offer the typical rate to a certain % of customers to make it legal.
  • netlang wrote:
    Or First Direct at 6.1% with no flexibility on overpayments.

    Hi, so no overpayments with FD, but do you (or any other patrons of this site) know how many months interest you get wacked for early repayment? BTW, i think NR and A&L have been trying this insurance scam for some time now!
    Thanks
  • cjm2508_2cjm2508_2 Forumite
    7 Posts
    I'm not sure about FD specifically, but they can charge up to one months interest, but are able to defer it for upto 28 days, during which interest accrues; so, worst case scenario = one month + 28 days.
  • netlangnetlang Forumite
    114 Posts
    100 Posts
    Nationwide will charge a maximum of 56 days interest but this does allow you to make overpayments which is used to reduce the term of loan.
  • Would it be worth agreeing to their insurance and thus their tidy little bonus? You may then be offered advertised rate.

    Not looked into it but I would have thought there would be a cooling off period for their insurance, just cancel it within that timeframe.

    Might be worth a try.
  • LongDongDaveLongDongDave Forumite
    405 Posts
    cjm2508 wrote:
    I'm not sure about FD specifically, but they can charge up to one months interest, but are able to defer it for upto 28 days, during which interest accrues; so, worst case scenario = one month + 28 days.

    Hi, i gave them a ring and they confirmed overpayments are not allowed and two month's interest is charged for early repayment of the loan.
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