Nationwide Mortgage - new fees and charges

Thrugelmir

jubjub wrote: »

Is everyone complaining to the Ombudsman or the FSA initially?

The FSO is the organisation handles consumer complaints. The FSA is the overall regulatory body and will merely redirect you to the FSO.

You initially have to complain to the lender. When you have their response, then proceed to the FOS. As you have to give grounds for your complaint.

The FOS rules on individual cases not on class action complaints.

You would need to consult a firm of solicitors such as Leon Kaye for a legal opinion.

Equaliser123

Thrugelmir wrote: »

You would need to consult a firm of solicitors such as Leon Kaye for a legal opinion.

Why them??

Thrugelmir

Equaliser123 wrote: »

Why them??

Their speciality is financial matters. Google the site and look for Skipton BS.

PiggyBank01

I`m also escalating it internally as I don`t feel the questions I`ve asked have been understood.

I tried calling them, then tried writing to them and then tried writing to Graham Barr. Each time they just gave the same answer so now it's with 'Member Services' and they have 8 weeks or so to respond before I can take it to the FSA.

My questions to them are basically:

1. I`m on a FIXED product and they're (effectively) increasing my rate during the fixed period. Either extend my consent to the end of my fixed period or waive the EPC charge so I can leave if they don`t want the 'risk'.

2. In the literature this penalty was listed as an 'additional interest rate' and according to their own mortgage conditions they can`t increase a fixed rate so instead they are abusing the true purpose of the Tariff Of Charges. There is nothing stopping them adding this to other products for those who are fixed into a contract with them.

I don`t hold much hope but I`ve got at least try, instead of simply rolling over like others on here.

Oh and before anyone jumps in - I understand WHY they are implementing this penalty my issue is with the way HOW they are doing it.

Equaliser123

Would be interested to know how many people have registered formal complaints with NW.

Solent_2

My complaint has been through the Lettings Team Manager, the Member Services (twice, with a detour to their legal department) and is now with the FSO.

samwardill

I asked them the following:
· Section 3.8 relating to Fees & Costs highlights that each fee or charge must be “fair and reasonable in relation to the cost of to us of doing the type of work for which the fee or charge is imposed.“ If the previous fee structure was fair and reasonable then the only way the new structure can be fair and reasonable is if Nationwide’s costs for providing the service of administering lettings have increased. I note that an increase in risk does not necessarily lead to an increase in costs. Can you demonstrate how Nationwide’s costs justify the new charging structure?
· Section 5.2 relating to Changes in Interest Rate lists the reason for which Nationwide may increase interest rates. This includes various reasons including a change in the way the property is occupied and a change in the cost of funds. My mortgage offer stated that my Base Mortgage Rate is guaranteed to be no more than 2% above the Bank of England base rate. Are Nationwide suggesting that section 5.2 supersedes and nullifies the mortgage rate cap detailed in my mortgage offer?"

They responded to say that they were refering to Section 12.3 which allows them to subject letting agreement to a fee. Thus they ignored both of my questions!

stamper

samwardill wrote: »

They responded to say that they were refering to Section 12.3 which allows them to subject letting agreement to a fee. Thus they ignored both of my questions!

It doesn't surprise me that Nationwide is now quoting this clause. Hopefully they've given up the whole risk-based argument. If 12.3 is the one I'm thinking of, it does indeed say that a fee can be charged for letting approval. This seems reasonable as some admin is no doubt required. However, I'd make 2 points. First, the letting fee quoted is surely represented by the £50 or so that they charge for approval. It doesn't make any sense to say that there are 2 separate fees (ie fee plus interest rate) that would both be due when a property is let. Second, I assume that any fee charged is still bound by the 'fair and reasonable' conditions which means it must be reflective of actual costs.

samwardill

I am posting my Ombudsman submission today, The complaint details box states:
"Nationwide have introduced an added interest rate of 1.5% if a property is let. I believe that this new fee structure is not in line with their terms and conditions and my mortgage offer.
· The mortgage offer states that (after the initial Tracker Rate) the loan will be on a Base Mortgage Rate which is guaranteed to be no more than 2% above the Bank of England base rate.
· The terms and conditions allow consent for letting to be subject to a fee. However they also state that each fee must be “fair and reasonable in relation to the cost to us of doing the type of work for which the fee or charge is imposed”.

I don’t believe that an additional interest rate can be regarded as a fee which is not subject to the interest rate cap in the mortgage offer. Even if it were regarded as such I do not believe that Nationwide could justify that this charge meets the fairness criteria in the terms & conditions. They have not answered my request for them to demonstrate that it does."

Poppy_Kennedy

wondering if anyone had any updates regarding this??