Nationwide Mortgage - new fees and charges

ph294

Engeroosi wrote: »

PH294 the fact is if you had permission to let the property out before the fees came into place then you are exempt from any of the fees. If you are seeking to have permission to let since the fees are introduced then you have to stump up the fees!

Hi Engeroosi,
I suspect you are right.

In your post from January you said

Engeroosi wrote: »

Nationwide are not going to increase anyones rate if they are in a fixed deal.

What's changed your mind? Have you had more info from NW? or were you only ever referring to those with existing consent to let?

Thanks,

Pete

ph294

Vincenzo wrote: »

In that case you may as well argue the toss with NW and see what happens. Good luck with it. I would be interested to hear your progress if you are happy to keep us updated?

Yes, will update any progress here.
Pete

Engeroosi

I was meaning anyone with the existing agreement in place who was in a fixed rate. Sorry to confuse you or get your hopes up.

ph294

Engeroosi wrote: »

I was meaning anyone with the existing agreement in place who was in a fixed rate. Sorry to confuse you or get your hopes up.

No problem, thanks for the clarification.
Pete

cashandassetpoor

PiggyBank01 wrote: »

I am one who is going to be impacted by this hike of 1.5% to my interest rate because I`m letting out my house. I did it not for BTL, not for profit but because I need to move out of my local area temporarily due to work with the intent to move back at some point (to sell eventually).

Because I`m letting out my property they now want 1.5% extra however I`m on a fixed rate deal with them (3 years left) so I either pay the extra % each month or get forced to pay the early payment charges - either way I`m significantly out of pocket to the tune of £3-4k.

They say because this change is to their Tarriff of Charges and not to the terms of the mortgage then there's nothing I can do. I guess they could put a 50% charge on and I`d just have to pay it.

I`m amazed they can do this - it's one thing adding a £90 exit fee to the tariff but a whopping 1.5% monthly penalty is abit harsh. I thought they might have give you the option to re-mortage elsewhere (voiding any early repayment charges). I understand their logic of the charge (risk/admin overheads) but those on a fixed deal have their hands completely tied.

Any advice?

The 1.5% won't start until you come off your deal.

Engeroosi

That depends when you got your permission to rent out the property?

murrayh

I sent a letter of complaint in with regard to the 1.5%, explaining my position as an accidental landlord and that the new fees were unfair etc and not reasonable. basically profiteering from people that if they sold would lose most of what they have put in and can't move mortgage easily. Using them as soft targets for generally increasing profit as they have suffered with less new business. NW called me yesterday saying that the fees are fair and that I have to sign the new permission to let form which is their way of getting you to agree to the new fee. I said at present I will not sign it without legal advice as it is a contract change i believe unfair. was told if I didn't sign I would be in breach of contract, but wouldn't go any further as what would happen. It ended with no real result with the person repeating the same points over and over, it Also kepts on about increased risk as i am letting, to which I pointed out that in 5 yrs I've never defaulted so where is the basis of risk . There was mention about it covering admin, but couldn't justify why it was so high, it felt pretty scripted.
I guess its the FOS now.
My fixed rate runs out end of july so will be pretty soon finding out what happens!

Vincenzo

murrayh wrote: »

My fixed rate runs out end of july so will be pretty soon finding out what happens!

Murrayh,

If I recall correctly, the new fees included penalties for letting without consent. They may try to apply these to your situation. Just thought I would mention it in case you need to consider in your course of action.

Good luck!

KarenBB

murrayh - you've said nationwide will charge the 1.5% when you finish you're fixed rate so you now have the option of taking your business from nationwide. As nationwide have given you lots of notice about the extra charge there has been time to arrange a mortgage elsewhere to avoid the 1.5%. It will be interesting to see what the FOS say in this case, Im not sure if the fact that you can leave nationwide at anytime will impact the case.

On a side note I've just read about someone wanting to let out a property that's mortgaged to the Halifax. I've copied the post below. 4% at Nationwide seems pretty good compared to what Halifax are offering their customer. (not as good as 2.5% I agree)

had asked Halifax for consent to let as I was going abroad for personal reasons and they are forcing me onto a buy to let remortgage. I am currently on a Standard Variable Rate of 3.5% (£852 per month) and they are giving me 2 options

Fixed for 3 years - 5.69% with a £1500 fee (£1010 per month)

Tracker for 3 years - 6.39% with a £600 fee (£1067 per month)

Which one would you choose

samwardill

I just had reply from the ombudsman "I accept Nationwide's view that the letting of a mortgaged property represents a different lending prospect than owner-occupation. I also accept its explanation of how it has set the fee of an additional annual charge of 1.5% - and this approach does not appear out of line with that histoncally taken by other lenders in the market. The principle that an additional interest charge is payable for lettings does not seem unreasonable or unusual.

Condition 12.3 of the agreement sets out that Nationwide may review the terms on which it allows the property to be let - including the application of a fee. I do not consider that condition 3.8 operates in such a way that would have prevented Nationwide from requiring the letting fee, or to prove additional costs incurred should the property have been let. "

I'm not convinced that a court would allow Nationwide such latitude in their terms and conditions but I've not got the will to fight. I've moved to hsbc tracker which is actually cheaper rate.