MSE News: Euro crisis - How safe is Santander?

callum9999

John_Pierpoint wrote: »

A mortgage is usually repayable on demand.
Are you sure that people will be lining up to buy these mortgages, like they weren't when Norther Rock fell.
Hullo N.Rock bad bank mortgage holders, here is one of the people who supplied you with your bail out, with a big thank you for keeping on paying instead of going bankrupt. :j

Seriously though it is looking like a few more failures of minor mortgage providers would enable Santander to put the rates up.

At the bottom of all this is the need to get rid of the debt, before it can "enslave" our grand-children.

Anyone who buys the mortgage books will do so knowing demanding they all repay on demand is immoral (whether they care or not is another matter - I think we all know the answer to that!) which will cause an enormous uproar, and also more importantly, physically impossible.

opinions4u

I'm pretty sure that a mortgage isn't repayable on demand unless you have broken the terms and conditions.

smartiedriver_2

John_Pierpoint wrote: »

A mortgage is usually repayable on demand.

No it isn't. Mortgages are term loans that will run the full term unless one or more of the conditions is breached, eg missed repayments. At this point it could normally be re-negotiated (eg interest rate increased).

Overdrafts, and on-demand loans (loans which are reviewed annually) are on demand products which can be withdrawn at any time. Normally banks would give 30 days' notice of such a withdrawal of facilities, but they are NOT REQUIRED to do so where the facility is on demand.

John_Pierpoint

I used to queue up in Abbey National - there was always a queue in Abbey National branches for some reason.
On the wall there was a warning to customers stating that a mortgage was repayable on demand.
Perhaps the law has been changed?
So that really is a recipe for going bust "borrow short and lend (permanently) long".

I suppose jacking the rates up, until the borrower goes elsewhere or defaults would have the same effect.

Daytona

Why are people criticising the article for being about Santander when it explains why ? -

"This story is not designed to highlight any specific Santander problems compared to other UK banks. However, we've received many questions from those who've seen news about Spanish financial woes and asked how it related to Santander. So we want to explain the issues."

jamesd

John_Pierpoint wrote: »

I used to queue up in Abbey National - there was always a queue in Abbey National branches for some reason.
On the wall there was a warning to customers stating that a mortgage was repayable on demand.

There are a couple of significant types of mortgage:

1. Repayable on demand. Means that the lender can repossess once a notice requiring payment of the mortgage has been served and payment has not been made three months after the notice was served.

2. The other type allows it when two current monthly installments have been missed.

The repayable on demand type is less secure for the borrower, in part because at a possession hearing it's the whole mortgage that the borrower has to be able to show they can repay in a reasonable time, not just the ongoing payments and some gradual clearing of arrears.

John_Pierpoint wrote: »

I suppose jacking the rates up, until the borrower goes elsewhere or defaults would have the same effect.

That could easily fail to be acceptable under the FSA's Treating Customers fairly requirements. Note that some lenders have been forced not to vary mortgage rates as a result of those requirements.

opinions4u

Daytona wrote: »

Why are people criticising the article for being about Santander when it explains why ? -

"This story is not designed to highlight any specific Santander problems compared to other UK banks. However, we've received many questions from those who've seen news about Spanish financial woes and asked how it related to Santander. So we want to explain the issues."

Becasue most people don't get past the headline, and the headline has the potential to panic people.

SantEmp

vroom3 wrote: »

What a load of old nonsense this article is!

Are we going to see a simialr article about Barclays or Lloyds etc or ING?

All this sort of ill informed headline scaremongering does is cause panic for people who rely websites such as this to understand what is happening today. This will result in them making ill inormed decisions on closing ISA's etc - which could cost in lost interest and penalties etc..

Mr Anker - More responsible journalism please!

Quite. It makes my job significantly more difficult, we've had plenty of confused and panicked customers this week withdrawing all of their money and looking to take it to a bank who still have a lower credit rating than we do. If only people knew what was actually happening rather than just what the sensationalistic headline tells them. In reality, Santander have approximately 97% invested on UK land, ironically making us the most English bank in the country and significantly more protected from the Euro crisis than others

Santander will never go under, just like it's highly unlikely ANY uk-based bank will. It's not in the government's interest to let it happen.

They don't like us to tell anyone, but we've got a little pot stowed away in case of emergencies too. Even if every customer in the business withdrew their cash, we'd have enough reserves to go on for another 2 years!

EDIT: By sensationalistic media I mean more your Sky News and tabloid media than Martin's post.

SantEmp

Doc_N wrote: »

The best reason not to bank with Santander isn't its financial position - it's the appalling customer service it provides, and its frequent mistakes. That, plus its riciculously low Faster Payments limits, and its frequent fouling up of Faster payments.

Why anybody would choose to bank with this shower escapes me completely when there are banks like First Direct around.

The customer service is improving. In our branch we boast 100% satisfaction and every quarter shows an upward trend across the region. When you take on 3 building societies within a couple of years you're bound to have problems. We're coming out the other side of this now.

Our faster payment limit is £200,000, compare that to the local Halifax's £5,000 (how much of that is their manager's desperation however...) so i'm not sure what you mean by that.

The worst thing about Santander is the quality of our debit cards. They look very tatty after merely a few months.

innovate

SantEmp wrote: »

They don't like us to tell anyone, but we've got a little pot stowed away in case of emergencies too. Even if every customer in the business withdrew their cash, we'd have enough reserves to go on for another 2 years!

SantEmp wrote: »

Our faster payment limit is £200,000,

SantEmp, I have thanked you for your last two posts because most in them makes a lot of sense to me. I also find Santander generally no worse than any of the other high street banks --- each has their own problems!

However, I wonder whether you can comment on the two bits quoted above: It is my own experience, and that of some mates, that Santander repeatedly slap a hard stop on any online payments above about £1K. Getting that stop removed invariably involves massive inconvenience, and sometimes people find their payments have actually been cancelled, without anyone telling them. Leading to often massive inconvenience / being in arrears etc etc etc.

If Santander have their "own little pot", and if your daily FP limit is £200K (when did this go up from £100K, btw?), then what's the point in making people's life hell when they actually want to transfer, online, the odd £20K- £50K to another account (their own or someone else's)?