Mortgage dropped from 5.35% to 4.99% but paying more???

stanleymog

Hi,

I have a mortgage with Norwich and Peterborough building society and in November it informed me that my new rate would be 4.99% from 1st November 2011 which turns out to be 0.36% cheaper than I was paying.

Two payments went out of my bank account at a higher rate than I was paying when it was 5.35% (After a hectic November and December, with a new baby who was taken back to hospital due to illness and lost bank paperwork which I found yesterday).

I rang the N&P today to ask why I am now paying more on a reduced rate, the answer I got was 'this sometimes happens!'

I asked how and they stated it could be to do with the period of the mortgage and how much I owe, but I told them that I have not increased my mortgage amount or the period of repayments.

Am I being strung along here? I just cannot gather how having a lower rate means paying more :mad:

Any help would be appreciated.

Thanks an advance.

financial_ombudsman_representative

Hello stanleymog

I work for the financial ombudsman – the free service set up by law with the power to sort out problems between consumers and financial businesses. It seems that you’re unhappy with the reason the business gave for this rise when you called them – so you might want to complain to the business in the first instance, they may be able to resolve this for you. If the business is unable to sort this out to your satisfaction, the ombudsman service may be able to help on 0300 123 9 123.

Thanks
Phillipa

maninthestreet

OP - can you please le us have the exact outstading mortgage amount, and you old and new monthly mortgage payments. Is this a straight repayment mortgage?

cottonhead

Doenst seem right to me. If the term has not increased and there is no additional borrowing and the interest rate has come down then so should the repayments. Thats what happened to us anyway. I would phone them again and make sure someone explains it properly to you. 'It happens sometimes' is not a good enough reason and so I guess you probably spoke to someone new or someone who couldnt be bothered to investigate! You havent changed your payment date or anything have you ? That sometimes slightly changes the amount due to the interest being recalculated.
Its probably just a mistake that needs correcting. Good luck !

stanleymog

Thank you for the replies, I have been intouch with them again and I must have got the same person because the reply I got was 'it is hard to explain!'

They are going to be sending me a letter to explain the reasons why, so I will give this 7 days and then go through the complaints procedure.

Once again thank you, at least it proves I'm not going mad!