Beware: Five Million Tracker Mortgages at Risk

ju5tice

Unfortunately, N&P are not telling the whole story !

I, and many thousands of other customers have a letter stating the facts which are contradictory to the verbal "assurance" they have given you.

This is the same Chief Executive who gave a public commitment (see post 14, Tracker Mortgages-Rip off thread)... and then went back on his word

Gorgeous_George

Maybe so. I only posted what they told me.

If it was me who had received the letter, I'd be recording my telephone calls and looking forward to my day in Court.

GG

PasturesNew

Surely if they're paying X% on top of base rate, then the amount of margin (and profit) for the BS will be the same whether the base rate is 0%, 1% or 10%!

Kavanne

PasturesNew wrote: »

Surely if they're paying X% on top of base rate, then the amount of margin (and profit) for the BS will be the same whether the base rate is 0%, 1% or 10%!

No because the base rate isn;t the same rate as what the BS are borrowing the money to lend to you at.

the BBC explained it to me once.

I think it's called the LIBOR?

Gorgeous_George

PasturesNew wrote: »

Surely if they're paying X% on top of base rate, then the amount of margin (and profit) for the BS will be the same whether the base rate is 0%, 1% or 10%!

I think savers have a say in the margins. I'm saving at 4.3% before tax. ISAs offer around 3.75%. Building societies and banks cost £££'s to staff, heat and maintain.

In short, lenders offered tracker deals that could see their businesses going bust. Some may have only a small percentage of money lent at uncompetitively low rates whilst for others the percentage will be higher. Imagine if you had 90% of your mortgage holders paying less than 1.5% - how would you keep savers satisfied? Where would you borrow at less than 1.5%? Clawing some back from new borrowers or from those on SVR may save the business. However, you can only do so much as you need to compete with other lenders.

GG

Red_Cat

I am not surprised that the N&P are doing this. They used to be a good local society, but I think they had delusions of grandeur and got caught out. Didn't stop them spending money on an image re-vamp whilst closing down some branches.
Not what a building society should be about.

Thrugelmir

Kavanne wrote: »

No because the base rate isn;t the same rate as what the BS are borrowing the money to lend to you at.

the BBC explained it to me once.

I think it's called the LIBOR?

The smaller mutual building societies have no access to wholesale funds. So LIBOR and BOE base is not relevant. They rely heavily on retail deposits, ie Joe Public to save with them.

Kavanne

thanks Thrugel

Mrs_Bumble

I am just getting caught up with this thread and the original thread and I am a little puzzled.

I used to work at N&P and as Gorgeous states above that mortgage prior to 2004/2005 there was not floor on tracker mortgages, purely I think because BBR had been consistently high and their hadn't been a real need.

I have spoken to the contact centre and I would have expected them to have been briefed on how to deal with a mass of angry mortgage customers, particuarly over the christmas period when staffing will be low, and I was told that they were not aware of this happening.

Anyone who has received this letter is the wording of the product that you have an offer for actually described as a lifetime tracker and

in section 4 of the mortgage offer/KFI what is the description of the mortgage product.

What is stated in Section 6

In Section 10 what are the early repayment charges?

treliac

Kavanne wrote: »

I have a standard life mortgage who have just been bought by Barclays... I am worried they will try something as my current rate is BoE BR + 0.75%

I was on Standard Life's SVR until the autumn. Shortly before ditching them in favour of a fixed rate elsewhere, they sent out a letter giving notice of how they could change their terms and conditions.

Can't remember the exact details, without finding the letter. We were about to leave anyway so didn't bother too much. But lenders obviously can make changes when it's in their interest to.

I'd always thought our SL mortgage was linked to BoE base rate and, when it didn't reduce in line with base rate, I read on here that it was linked to Libor. Well, it didn't fall in with that either. So I gave up altogether. They obviously didn't want our business.