MSE News: Bank of Ireland to raise mortgage SVR

AMILLIONDOLLARS

moneymagnet wrote: »

My original loan was with Bristol & West and I received a letter stating that when BOI took over there would be no change to the t&C. My T&C say that after the fixed term expires (it already has) then my payments could go up if the interest rates change. I took this to mean BOE interest rates. Surely this is misleading? Can I complain on these grounds?

Well the rates have changed, BOI have just changed them! There was no mention of BOE interest rates in the wording of the paragraph. Sorry for your troubles.

AMD

ILW

darlodave wrote: »

Nationalised banks subsidised by my taxes.

So who do you think would be the losers if they had been allowed to collapse?

Would you have been OK if your pay was not honoured for example?

moneymagnet_2

AMILLIONDOLLARS wrote: »

Well the rates have changed, BOI have just changed them! There was no mention of BOE interest rates in the wording of the paragraph. Sorry for your troubles.

AMD

I guess you're right I have always assumed that mortgages were linked in some way to BOE interest rates. This has always been the case in the past for me. How are you supposed to sign an agreement to pay for something when they can just charge what they like? They go to great lengths to explain that you must be sure you can afford the repayments - how can you do this if you haven't got some sort of an idea of what they may be?

darlodave

ILW wrote: »

So who do you think would be the losers if they had been allowed to collapse?

Would you have been OK if your pay was not honoured for example?

It wouldn't have affected me as my pay would have been channelled thorugh another account. The main losers would clearly have been the shareholders, staff and investment funds but they 'chose' to engage with that institution as I chose an SVR. No different to stakeholders in Woolworths and the myriad of other businesses that fail. Sadly, that is the nature of investment risk, a principle that posters on this forum seem to support rightly. I would also be a loser but the key difference here is the government used my money, it was not my investment choice. I'd rather be responsible for my own bad decisions. The main thing is that when posters on this site talk about the laws of the market they need to be careful they apply a consistent rule to individual households AND large corporations.

darlodave

moneymagnet wrote: »

They go to great lengths to explain that you must be sure you can afford the repayments - how can you do this if you haven't got some sort of an idea of what they may be?

...or a degree in economics.

ILW

darlodave wrote: »

It wouldn't have affected me as my pay would have been channelled thorugh another account. The main losers would clearly have been the shareholders, staff and investment funds but they 'chose' to engage with that institution as I chose an SVR. No different to stakeholders in Woolworths and the myriad of other businesses that fail. Sadly, that is the nature of investment risk, a principle that posters on this forum seem to support rightly. I would also be a loser but the key difference here is the government used my money, it was not my investment choice. I'd rather be responsible for my own bad decisions. The main thing is that when posters on this site talk about the laws of the market they need to be careful they apply a consistent rule to individual households AND large corporations.

If a company fails, all transactions are frozen. That is why the bailout was required. The whole system would have come to an abrupt halt, which would have been a total disaster.

moneymagnet_2

Another question - Am I the only one who thought that SVR was governed by the bank of England base rate. Surely I can't be? Can you imagine anyone agreeing to a rate that can be anything the lender chooses to charge? Bank: "So Mrs. M - sign here for this loan and we'll just pick and choose what we charge you" Customer:"Yes of course that sounds reasonable- it's not that important is it? After all I can't lose anything except my home can I?"

opinions4u

moneymagnet wrote: »

Another question - Am I the only one who thought that SVR was governed by the bank of England base rate. Surely I can't be?

You won't be the only one. But you will be in a small minority.

Can you imagine anyone agreeing to a rate that can be anything the lender chooses to charge?

Every mortgage I've ever taken has had this inherent risk.

ILW

moneymagnet wrote: »

Another question - Am I the only one who thought that SVR was governed by the bank of England base rate. Surely I can't be? Can you imagine anyone agreeing to a rate that can be anything the lender chooses to charge? Bank: "So Mrs. M - sign here for this loan and we'll just pick and choose what we charge you" Customer:"Yes of course that sounds reasonable- it's not that important is it? After all I can't lose anything except my home can I?"

It appears that you are not the only one. But you are still mistaken. What did you think the V on SVR stood for?
Had you never heard of a tracker mortgage and wondered what the difference was?

moneymagnet_2

ILW wrote: »

It appears that you are not the only one. But you are still mistaken. What did you think the V on SVR stood for?
Had you never heard of a tracker mortgage and wondered what the difference was?

Yes you're right, but I would have expected my IFA to spell it out for me, that's his job! It's like a solicitor not doing his conveyancing properly. After all if I knew about this stuff I wouldn't have gone to an IFA I'd have done it myself.