MSE News: Mortgage blow as building society hikes SVR

sarahbennett

To all Skipton borrowers affected by this breach of contract of their SVR mortgages, I'm not going to waste any more time on this thread. There are some extremely unpleasant people here as you will have noticed, and even a watertight case will never win them over. They have the attitude that we are bad to have borrowed and should be punished. They don't care about our financial positions, the terms in our agreements, and whether we've been fairly treated, so I've come to the conclusion sadly, that it's a waste of time staying. We're going to have to pull together all our resources to stop Skipton from getting away with what they are trying to do, almost all of us will have other things to do and pressures on our lives. Here's what I propose as a course of action:

(1) Join the facebook group "Skipton Building Society Mortgage Borrowers Against SVR Rise
http://www.facebook.com/group.php?gid=309129390147&ref=mf
(2) Tell everyone about it
(3) Sign the petition at http://petition.zedbox.com and/or 10 Downing Street (remember it's a petition to Skipton not the government, the government has not approved what Skipton are doing so we have no issue with No10 at this point, methinks)
(4) Get onto big facebook groups for Skipton and Scarborough, and other large facebook groups letting them know about the Daily Mail "This is Money" Article that links to the facebook group...
http://blogs.thisismoney.co.uk/2010/01/angry-skipton-borrowers-turn-to-facebook.html
(5) talk to your local papers and radio, just put in a call, I've been told this will already be covered in one bbc show I've been asked to take part in, and finally
(6) don't let the ****annoying people**** get you down, don't get stressed, hopefully between us we will be able to make a difference

Thrugelmir

sarahbennett wrote: »

To all Skipton borrowers affected by this breach of contract of their SVR mortgages, I'm not going to waste any more time on this thread. There are some extremely unpleasant people here as you will have noticed, and even a watertight case will never win them over. They have the attitude that we are bad to have borrowed and should be punished. They don't care about our financial positions, the terms in our agreements, and whether we've been fairly treated, so I've come to the conclusion sadly, that it's a waste of time staying. We're going to have to pull together all our resources to stop Skipton from getting away with what they are trying to do, almost all of us will have other things to do and pressures on our lives. Here's what I propose as a course of action:

(1) Join the facebook group "Skipton Building Society Mortgage Borrowers Against SVR Rise
http://www.facebook.com/group.php?gid=309129390147&ref=mf
(2) Tell everyone about it
(3) Sign the petition at http://petition.zedbox.com and/or 10 Downing Street (remember it's a petition to Skipton not the government, the government has not approved what Skipton are doing so we have no issue with No10 at this point, methinks)
(4) Get onto big facebook groups for Skipton and Scarborough, and other large facebook groups letting them know about the Daily Mail "This is Money" Article that links to the facebook group...
http://blogs.thisismoney.co.uk/2010/01/angry-skipton-borrowers-turn-to-facebook.html
(5) talk to your local papers and radio, just put in a call, I've been told this will already be covered in one bbc show I've been asked to take part in, and finally
(6) , don't get stressed, hopefully between us we will be able to make a difference

People are not unpleasant as you put it. They have a different perspective of the current financial situation to you.

Why swear? For all your good words. The tone of your last post

don't let the ****annoying people**** get you down

suggests another darker side to you.

sarahbennett

VIGILANT22 wrote: »

Pay back the amount you have borrowed .........easy solution

Just about says it all to me with respect to the callousness of some of the comments here, and misses the point of our complaints.

(7) Read "Ralph Nader" post in this string, submit a complaint to Skipton (they will log a complaint even if made by telephone). They have 8 weeks from receiving your complaint to give you a final resolution. This is worth doing no matter what. And the earlier date you get on this the better, you can say you feel they've cited "exceptional circumstances" clause inappropriately and do not be drawn into any attempts to either get you to take up another product or say exceptional circumstances exist.
(8) Be sure to send a copy of the letter you receive from Skipton (they will send you a template letter most likely to start) and complain to the Ombudsman:
http://www.financial-ombudsman.org.uk/consumer/complaints.htm

dasilva_2

Just to outline the excellent management the Skipton has had, I notice that a leicestershire company, Wadkins has gone under today because it's main backer, The Skipton Building Society has pulled the plug. I am not commenting about them pulling the plug to save people replying that was the right thing to do. I am commenting that they have obviously been acting as a Bank in the commercial market, not a building society for the benefit of their mutual members and any additional profits they made through those commercial ventures has been syphoned off. I wonder what rate Wadkins was paying on their borrowing?
It all points that their 'exceptional circumstances' clause should be invoked because of their management has been exceptionally irresponsible.
Sarah Bennett. For what it is worth, I would just like to throw my opinion to the 'campaigns' you are suggesting. I don't want to knock them but there seems to be a few of them thus fragmenting their effect. Surely it would be a better option to try and get them all together and have one big one. If you offer the Skipton some money, I'm sure they will sell you their mortgage holders names and addresses for a mailshot. They seem to be pretty skint and don't understand the data protection act.
I'd also like to point out I have no vested interest, my mortgage is with another serially irresponsible lender, Northern Rock and I am already paying for their irresponsibility, while its previous irresponsible management live in the luxury we have all created for them.

sarahbennett

dasilva wrote: »

It all points that their 'exceptional circumstances' clause should be invoked because of their management has been exceptionally irresponsible.

Couldn't agree more!

dasilva wrote: »

Sarah Bennett. For what it is worth, I would just like to throw my opinion to the 'campaigns' you are suggesting. I don't want to knock them but there seems to be a few of them thus fragmenting their effect. Surely it would be a better option to try and get them all together and have one big one.

I set the facebook group up as that was easy to do in a hurry... wish I did have more time

dasilva wrote: »

If you offer the Skipton some money, I'm sure they will sell you their mortgage holders names and addresses for a mailshot. They seem to be pretty skint and don't understand the data protection act.
I'd also like to point out I have no vested interest, my mortgage is with another serially irresponsible lender, Northern Rock and I am already paying for their irresponsibility, while its previous irresponsible management live in the luxury we have all created for them.

Brilliant!

Ron2256

dasilva wrote: »

I will go back to one of my previous posts on this thread where I was accused of 'trolling'
On the Skipton website it states that one of the tests for 'exceptional' circumstances (as RECENTLY defined by the societies board) is that the BOE rate is less than 2.7% and it then reiterates 'exceptional circumstance STILL prevails'
It has prevailed for over a year now so why not instigate the clause in nov 2008 when the rate fell below the 'test' level.
It seems to me that would indicate that the boards definition of 'exceptional' has changed since then. I seems to me that people taking hundred of thousands of pounds a year off mutual members would be expected to have the intelligence to put in to an agreement a simple clause at the outset of that agreement, ie if the BOE rate fall below 2.7% we will not honour the 3% guarantee.
This is a quote from their website 'Historically, Skipton has maintained its SVR at a competitive level of 1% to 2% above Base Rate, so the SVR has remained comfortably below its ceiling. However, when the Bank of England reduced Base Rate to the current historic low of 0.5%, the ceiling prevented us from keeping our SVR in line with the market. As a result, our SVR has now remained far below market norms for building societies for almost a year.'
They just seem to be trying to get out of their contract with mortgage holders. What are 'market norms'?, that seems to indicate some sort of cartel as if they need to realign to other mortgage rates. The market price is made up by market forces
I wonder if there is a similar upper limit to their rate?

Here is your 'exceptional circumstances':

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/7130790/Building-societes-hit-by-record-cash-crisis.html

Savers withdrew £7.6bn from the country's 52 societies in 2009 because of record low interest rates and fierce competition from the banks. The collapse in wholesale market funding exacerbated matters. Societies lost another £22.6bn as local authorities withdrew about £6bn of cash and other money market credit lines were not rolled over.

The £30.2bn contraction in funding, revealed by the Building Societies Association (BSA), was the most severe on record. As a result, societies have had to remove credit from other areas of operation as well.

The savers have pulled the plug, fed up with low interest which means Building societies have to increase interest rates to attract savers back. The BOE base rate is irrelevant.

Thanks to mystic_trev for the pointer.

dasilva_2

Ron 2256 "here is your exceptional circumstance"

Where? It is not for me or you to 'define' the relevant exceptional circumstance.
My point is that the board of Skipton have defined the 'exceptional circumstance' and it is not the one you have pointed out. Take a look at their website and check out 'what is an exceptional circumstance'
Anyone can come up with an incident that could be exceptional, ie I had a sausage sandwich this morning which is exceptional as i normally have porridge, but I hope that the interest rate does not rise because of it.
The board of Skipton have defined the exceptional circumstances and as one of them (ie the BOE rate is less than 2.7%) has been for more than a year, I no longer think it is exceptional. Its their definition I am arguing about, not mine or yours.

Ron2256

dasilva wrote: »

Ron 2256 "here is your exceptional circumstance"

Where? It is not for me or you to 'define' the relevant exceptional circumstance.
My point is that the board of Skipton have defined the 'exceptional circumstance' and it is not the one you have pointed out. Take a look at their website and check out 'what is an exceptional circumstance'
Anyone can come up with an incident that could be exceptional, ie I had a sausage sandwich this morning which is exceptional as i normally have porridge, but I hope that the interest rate does not rise because of it.
The board of Skipton have defined the exceptional circumstances and as one of them (ie the BOE rate is less than 2.7%) has been for more than a year, I no longer think it is exceptional. Its their definition I am arguing about, not mine or yours.

So what are you saying then? You think they should have put the rate up a year ago? No, I don't think so.
I guess, they didn't want to increase rate last year because they thought the low rate would be temporary, or they could absorb it, or they would be able to fund the mortgage deals by lowering interest on saving. They got it wrong. Low rates are sticking and savers are withdrawing their money

I can see two exceptional events in what happened to the IR. 1, it's gone down to 0.5%. I think everybody spotted that one. 2, it's been at 0.5% for nearly a year and no sign of budging.

I am just playing the devils advocate here. I understand your position but I also understand the position of the BS. They are having big troubles and are trying to stay afloat.

dasilva_2

Ron2256.
What I am saying is
1. they have an exceptional circumstances clause in their mortgage contract.
2. They are the ones that defining what those exceptional circumstances are. Please look at their website as it clearly states and I quote 'what are exceptional circumstances:- The circumstances currently prevailing are exceptional under each of two separate tests, which have recently been defined by the Society's board as follows:
1. Base Rate is less than or equal to 2.7%
or
2. Base Rate minus the UK average Branch Instant Access savings rate (as published monthly by the Bank of England) is less than or equal to 2.5% for each of the three preceding months'
These conditions were met in oct 2008 yet Skipton continued to market a product with a guarantee that was not guaranteed because their own exceptional circumstances prevailed at the time.
I am actually saying that if that was the exceptional circumstances that they were stating, they should have acted on them when they started to prevail or at least explained that the circumstances prevailed at the time, but they were holding off acting on them.
The fact that they also state that the exceptional circumstances were only 'recently' defined would indicate that they were just making it up as they went along

sarahbennett

Ron2256 wrote: »

So what are you saying then? You think they should have put the rate up a year ago? No, I don't think so.
I guess, they didn't want to increase rate last year because they thought the low rate would be temporary, or they could absorb it, or they would be able to fund the mortgage deals by lowering interest on saving. They got it wrong. Low rates are sticking and savers are withdrawing their money
I can see two exceptional events in what happened to the IR. 1, it's gone down to 0.5%. I think everybody spotted that one. 2, it's been at 0.5% for nearly a year and no sign of budging.

What you don't seem to be getting is that the agreement explicitly states the buyer will benefit from any falls in BOE base rates but it does not in any way suggest that the base rate level itself could constitute an "exceptional circumstance", nor does it in any way suggest the Skipton's own financial position might constitute such an event, if it had been trying to include these issues of severity and "imprudence and debt" within its definition it should have spelt them out

(1) Because not to spell them out makes it a qualitatively different agreement with a very different risk profile, so, instead of telling the customer they will benefit from any fall in the base rate they should have been told that they would only have this benefit to a base rate of 2.7%, at or below which they would receive no benefit. Maybe by exceptional circumstances they meant Skipton's own financial position, in which case they should have said so as well.

(2) There is relatively little case law on exceptional circumstances and that that I have managed to find concerning any relation between debtor and lender does explicitly state that exceptional circumstances can never be circumstances that are arrived at due to debt and improvidence, that they must be different types of circumstance altogether and not the severity or extent of a circumstance. If they wanted to use exceptional circumstances in such a way that is unusual or not previously held in court (in this case they wanted to refer to debt improvidence and base rate severity) this should have been spelt out.

Ron2256 wrote: »

I am just playing the devils advocate here. I understand your position but I also understand the position of the BS. They are having big troubles and are trying to stay afloat.

This would not be an argument that would make them hesitate in enforcing the contract against me, there is nothing in the agreement to imply that they will be let off their guarantee if they experience financial difficulties or have made poor decisions.

Are people here suggesting that exceptional circumstances can mean anything that the BS want it to mean? Skipton seem to imply that on their website they have: (a) base rate (b) profitability and also other exceptional circumstances as might arise, again with no definition. Doesn't that make it a bit broad? If it is entirely at their discretion doesn't it catch any kind of circumstance and in so doing doesn't that make it a catch -all (and hence an unfair contract term)?