Mortgage scam?

missmoneybags_4

Ok. I’ve got a bit of a long and drawn out saga so please bear with me on this…

I have a mortgage with Abbey/Santander. I moved to a bigger house 2 years ago and had to borrow additional funds. I already had what they call a “product”, which was due to expire June 2010. If I was to cancel this product and get a new higher mortgage I was liable for an early repayment fee (ERF) of £4k. The other option was to lend additional money on a second product. I decided this would the cheaper option and did this at an interest rate of 6.39% and was tied in until October 2022.

The “original product” is due to expire in June this year so I asked if they could quote me for a new product. The longest period they had for me was 2 years at 4.99%. I decided this was the best rate available and paid £125 to secure the product until June 2012. I signed and returned the paperwork and here is the problem starts….

I received a letter yesterday dated 19/4/10-acknowledging receipt of the new product and they said they would be in touch nearer the time to confirm this has gone live. On the same day I received a new mortgage pack dated 20/4/10 advising that the rate for both products is set at 4.99% for 2 years?

I called the mortgage centre today and I have been advised that their “rates” department have changed the rate for both products to 4.99% for 2 years and I have 2 options.
1) I can revert to what it should be - product 1 at 6.39% until 2022 and product 2 at 4.99% until 2012. I would not be charged an ERF as this has been changed by Santander and not by myself.
2) I can stay on their new terms of both products at 4.99% until 2012. once again no ERF to pay as this is a Santander error.

I really don’t know what to do. Should I employ a mortgage adviser to help me with this?
Do I stick with the long term product or should I let them put me on 2 years then shop around in 2 years time?
Is this a scam? Do Santander know something we don’t?
I’m in a real pickle about this and would appreciate any advice given!

Thanks
MM

_Andy_

So they made an error and have offered to rectify it meaning you haven't lost out at all.
In what way is that a 'scam'?

missmoneybags_4

I think scam as is in they know something I don't know. When the election is over and we possibly get a new government i.e conservatives, the rates all of a sudden go back up to the 1980's ridiculous rates.
I'm an accountant and prudence is my middle name. Mortgages are not my territory this is why I need some advice.

MacsReturns

I doubt Santander's crystal ball is any better than mine (or yours). NO-ONE knows what interest rates will be in two years (after the Lib Dems win the election )

All I can see that has happened is that you've had your rate reduced by 1.4% for two years with no fees, unless I missed something.... Otherwise, I'd check for any lock-in on your 2022 product and check how soon you can shop around.

Somerset

missmoneybags wrote: »

........ and prudence is my middle name...........

Thought that was Gordon's tag.

missmoneybags_4

If Gordon has used my “tag” then I shall send a letter of complaint.:mad:
It was meant as one of the accounting concepts and I certainly did not mean anything political :embarasse

dimbo61

If it was me I would take the two year deal on "both" parts of the mortgage and then remortgage the whole amount still owed in 2012 and count your blessings.
This is Santander,s mistake and you are not having to pay ERC,s in 2 years to change lender if you so wish.

getmore4less

So a short while ago you were happy with the 6.39% for 14y(2008-2022?) what has changed?

14y tie in seems a little less than prudant


Have you mixed up your 1 and 2 they seem to have swaped in the later part of your post.

Wutang_2

Take them to the European Court of Justice. These scams are ruining this country.