tracker mortgages- Rip off

Thrugelmir

Gorgeous_George wrote: »

No offence but I'd like confirmation from the BBC or a reliable long term MSEer. Is it just newbies that N&P are targetting?

GG

The N&P can only target those customers where the contractual terms allow them too.

Its worth noting that the Building Societies are picking up the tab for the FSA's Icelandic bail out. So there is far more to this story than just interest rates for savers and borrowers.

Gorgeous_George

If they are invoking a floor that is in the contract then there is no story and certainly no rip-off.

The way I read the OP was that they were increasing the track margin. That is not the same thing.

GG

Thrugelmir

Gorgeous_George wrote: »

If they are invoking a floor that is in the contract then there is no story and certainly no rip-off.

The way I read the OP was that they were increasing the track margin. That is not the same thing.

GG

Mutual building societies unlike the retail banks are dependent on depositors for there funds to lend. In simple terms. At the moment any borrower with the N&P on a low interest rate life time tracker is better off saving their money with the N&P in a savings account than paying off their mortgage. So the N&P is losing money in lending money!

Unfortunately borrowers may therefore have a choice to make of seeing their lender disappear entirely or paying a higher rate with the N&P.

No one foresaw that BOE base rate would drop this low, and not stay as low as it now appears.

So the "get out" clause more than likely covers this eventuality. At the end of the day the FSA has to look after the interests of all the members of the N&P both savers and borrowers, not one specfic group to the detriment of others.

ThrowingStonesAtYou

Oh dear, I think it's unfair to blame N+P for all this, it's merely the consequence of exceptionally poor economic management by the government, but I can see why people feel ripped off. I agree with the above that it looks like a straight choice between challenging this and causing N+P to go bust, or accepting the change. Either way looks to me like you guys will be looking at new mortgage deals.

Charterhouse

I don't think they will have a leg to stand on if action is taken appropriately and promptly. It's definitely vital to get your case in front of the Ombudsman asap. I believe you first have to complain to N&P before you go to the FOS. You would want to set out a well structured defence in a formal letter, making the point that you do not see how the change can be in accordance with the terms of the agreement, when one vital point of the terms of the agreement is that the mortgage is a lifetime tracker at base+115. They will possibly back down at this stage but if not you will want to accelerate it to the FOS as soon as possible. Make sure once again that the complaint is presented clearly in a formal letter with as many supporting documents as possible.

Good luck.

@ ThrowingStones, sorry, I disagree. I don't care how badly the Government screwed up, trying to wriggle out of these sorts of agreements is bad for all of us.

StevieJ

ThrowingStonesAtYou wrote: »

Oh dear, I think it's unfair to blame N+P for all this, it's merely the consequence of exceptionally poor economic management by the government, but I can see why people feel ripped off. I agree with the above that it looks like a straight choice between challenging this and causing N+P to go bust, or accepting the change. Either way looks to me like you guys will be looking at new mortgage deals.

I presume you mean most governments as most of the majors seem to have very low interest rates at the moment, then again you would't like to miss the opportunity of scoring a political point would you

Flashback_2

Oh dear, I think it's unfair to blame N+P for all this, it's merely the consequence of exceptionally poor economic management by the government, but I can see why people feel ripped off. I agree with the above that it looks like a straight choice between challenging this and causing N+P to go bust, or accepting the change. Either way looks to me like you guys will be looking at new mortgage deals.

This is rubbish. N&P directors are fully to blame. If they offer TRACKER MORTGAGES then they should make sure they can honour them for the term of the mortgage. Why blame the economic crisis. Banks should always be run prudently.

N&P could have done the honourable thing and merged with another lender and saved their customers a lot of pain. N&P directors are more interested in preserving their precious jobs then doing the right thing by customers. They have trashed the reputation of N&P. I trusted N&P and I feel betrayed.

I certainly think that N&P was not in a position to sell Tracker rate mortgages, they should have been selilng mortgages on the basis of it own Standard Variable Rate.....

Tunstallstoven

And now this bumped, would be interesting to see how those effected have been getting on and whether any resolutions have been reached...

Thrugelmir

Flashback wrote: »

This is rubbish. N&P directors are fully to blame. If they offer TRACKER MORTGAGES then they should make sure they can honour them for the term of the mortgage. Why blame the economic crisis. Banks should always be run prudently.

So in effect you are in support of the Directors of the N&P. As the are running the business prudently and in compliance with regulatory law.

Flashback_2

So in effect you are in support of the Directors of the N&P. As the are running the business prudently and in compliance with regulatory law.

That is certainly not what I said. If N&P had been prudent, they would not have lent out money more then they access to. In these uncertain economic times, N&P has let down borrowers by increasing interest rates. I wonder how many borrowers N&P will put into trouble or default. Certainly, if the borrowers had been with a tracker with a bank, they would have been in a better position.