tracker mortgages- Rip off

ju5tice

Dear Forum,

Norwich and Peterborough Building Society-mortgage tracker increase by 300%

I have had a Life-time tracker mortgage with N&P since 2006. The tracker mortgage tracks Base Rate +1.15%.

I have today received a letter that my tracker rate is to change to Base Rate +3.4%.

This is 300% increase ! I thought when a life time tracker is taken out, it means just that ! If N&P have done this today, then others will follow. This will affect alot of people.

Please advise what can I do. Thanks

Trollfever

How much notice have you been given to the change in your T&C's?




.

ju5tice

Hi Trollfever,

The change in payments will take effect from 1/02/2010

Trollfever

ju5tice wrote: »

Hi Trollfever,

The change in payments will take effect from 1/02/2010

If you have only been given just over a month to reorganise your finances then I think that a formal complaint to N&P is in order, followed up by a complaint to The Financial Ombudsman Service.

ju5tice

what can be done about the increase in the tracker rate ?

Trollfever

ju5tice wrote: »

what can be done about the increase in the tracker rate ?

Walk, but I think that it would be reasonable to give you three months notice to find a new lender.

ju5tice

is there any point in taking this to the FSA ? what can they do ? How long will it take ? Likely outcome ?

waveneygnome

Sory to hear about your N&P mortgage. Doesn't sound too good.

A friend of mine works at the HQ of N&P and they have been strapped for cash for a while - the big banks have all got handouts from the Gov, but small Building Societies received nothing, yet the rates they are having to borrow funds (in order to lend) have increased. N&P have had to shut 10 branches and are looking to contract further.

I assume your mortgage rate change is an attempt by them to improve their margins and stay in business. Still doesn't seem fair or reasonable though.

On a more practical front:

1) You need to put a formal complaint into N&P (I would suggest this needs to be two pronged: a) not fair/reasonable to amend a lifetime tracker rate b) not fair reasonable to only give you 1 month notice f change (not enough time for you to move mortgage even if you could find a better rate)

2) N&P need to give you a formal 'Final Response' to your complaint

3) Once you have that, then you need to lodge a complaint with the Financial Ombudsman Service (FSO)....not Financial Services Authority........and they will look into your complaint.

BUT............be warned this is not a quick process.

Expect N&P to take a few weeks to respond
FOS will take months (I have a complaint with FOS and its been 6 months and not progressed very far yet!)

I would suggest you try and dig out any of the original documents you can find and use as evidence in your complaints.

Hope this helps.
WG

opinions4u

ju5tice wrote: »

Dear Forum,

Norwich and Peterborough Building Society-mortgage tracker increase by 300%

I have had a Life-time tracker mortgage with N&P since 2006. The tracker mortgage tracks Base Rate +1.15%.

I have today received a letter that my tracker rate is to change to Base Rate +3.4%.

This is 300% increase ! I thought when a life time tracker is taken out, it means just that ! If N&P have done this today, then others will follow. This will affect alot of people.

Please advise what can I do. Thanks

The key here is what documentation do you have to prove that it's a "Lifetime Tracker"?

1) What does your mortgage offer say?
2) What does your Key Facts document say?
3) What do the small print terms and conditions say?

If you've got a guarantee written in to (1) or (2) you will almost certainly win if you take you case to the FOS (the post above mine explains the process. But it will take time).

ju5tice

Thanks 4 the advice, opinions4u and WG.

I am looking into my mortgage documents and will inform you accordingly.

Kind regards

Ju5tice

ju5tice

Hi,

From my mortgage documentation it states :

" the interest rate charged will be either 1.15% above Bank Base rate or 3%, for the Mortgage Term."

I was not given a key facts document.