When is a 2-year fixed rate not a 2-year fixed rate?

Fairdo_2

As detailed by previous posters, the deals are labelled for example as a 2 year fixed rate, but most have expiry date details in the Key Facts Illustrations. Therefore, you will see, for example: "Fixed Rate until 31/05/2012" It is in bold print and not hidden away at the back.

You would have a point if it said "Fixed for 2 years from Drawdown/Completion" for example, but that again is usually cross referenced with very clear conditions in the Mortgage Offer. For example, "You must drawdown funds within/by..........."

I don't think it would be fair to say that the Key Facts Illustrations are mis-leading regarding this, but that is a personal opinion!

gardnose

Hi,

Fairdo is correct - the key facts illustration does show the expiry date, and the small print does say that you have to draw the mortgage within 6 months.

But I do like JimmyTheWig's analogy of the coke bottle. I really don't think it's made clear that if you can't make it to the shops for a few days then they won't give you the full bottle that you ordered (and paid for the pleasure of being able to order it in advance).

When you go through the mortgage application process, the whole thing is very much tied to the house you are purchasing. If the sale falls through, suddenly the mortgage is treated as something completely separate (the lid is off and the coke is evaporating). You do of course have the option of starting a completely new deal to get your full two years, but you would need to pay a new booking fee for the pleasure.

beecher2

gardnose wrote: »

Hi,

Fairdo is correct - the key facts illustration does show the expiry date, and the small print does say that you have to draw the mortgage within 6 months.

But I do like JimmyTheWig's analogy of the coke bottle. I really don't think it's made clear that if you can't make it to the shops for a few days then they won't give you the full bottle that you ordered (and paid for the pleasure of being able to order it in advance).

You might get more than a full bottle, depending on your timing - my deals have always lasted longer than the 3/4 years I've had them. In fact you'll find people on here complaining that their deal is longer than they expected, and how the banks are conning them because the SVR is lower than their deal.

gardnose

Looks like I'm going to have to chalk this one up to experience. One day I'll chalk up some experience without it costing me money ;-)

ukclarkkent

gardnose wrote: »

Looks like I'm going to have to chalk this one up to experience. One day I'll chalk up some experience without it costing me money ;-)

when you do that, give me a shout 'cos i could do with some of that ;-)