Abbey - what's the catch?!

davidla

Hi All

At the moment we're on Abbey's SVR 4.24%. We received a letter from them last week saying the can either put us on a
1. 3.99% fixed rate for 2 years or
2. 4.19% for 3 years or
3. 4.79% for 5 years.

In each case there are no fees and we can still overpay 10% p.a.

We have (I'm guessing) 85% or 90% LTV - so my question is, why are they doing this? I don't see what they have to gain. (Note, I am not complaining, just curious!)

Thanks,
David

Matty0682

Hi,

I'd be asking the same question. Are you sure there are no fees (valuation, set-up, admin fee)?

Maybe this is a case of Abbey wanting to tie you in to ensure you don't re-mortgage elsewhere (as your a good customer always paying on time).

However, given your relatively high LTV, I'm surprised they are this generous.

Read all the terms and conditions

mbailey

If you are just on SVR you can leave at any time. This ties you to a contract so they can't lose you as a customer (unless you pay some sort of exit fees.)

May be they are also assuming you will go with the security of the 5yr option so then you will end up paying them more?

suisidevw

90% LTV and getting those deals..... ?!?!?!

davidla

On the letter it says no booking or transfer fees. I am - so far! - a good customer, paying on time and even over-paying.
Well you/they might be right about the 5 year option - feeling tempted to take it.
Just had a look at moneysupermarket - lowest rate for 85-90% remortgage is 6.59% - and that's only for the first 2 years!
I even called Abbey - and they confirmed I was eligible for the offer.

I assume others have had this offer as well.

suisidevw

Insta-take it?!

davidla

suisidevw wrote: »

Insta-take it?!

Eh?
Instantly take it?

suisidevw

Correct Sir.