MSE News: Bank of Ireland to raise mortgage SVR

ILW

I don't think that anybody believes that the variable rate on their credit card is linked to base rate, so why assume that the variable rate on a mortgage is?

AMILLIONDOLLARS

Just sitting here waiting for Nationwide to announce my BMR will increase because........:whistle:

There are no guarantees in this life:(

AMD

_Andy_

moneymagnet wrote: »

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.

How did you want anyone to explain what 'variable' meant? Clue's in the word, surely

suburbanwifey

ILW wrote: »

I don't think that anybody believes that the variable rate on their credit card is linked to base rate, so why assume that the variable rate on a mortgage is?

Because of the scenario I point out below, which cannot be denied because it happened to me and millions of others in the eact way described below:


Whenever BOE raised rates, my mortgage company raised rates. When the BOE started lowering rates, I immediately got a letter saying my rate was going down. If the BOE raised rates again, the mortgage company raised their SVR again ... see my point? if the SVR is not linked to a BOE base rate, then WHY did my mortgage company (and hundreds of others) raise or lower rates accordingly as to what the BOE was doing ????? Is it no wonder people assumed that SVR follow BOE rates?

moneymagnet_2

ILW wrote: »

I don't think that anybody believes that the variable rate on their credit card is linked to base rate, so why assume that the variable rate on a mortgage is?

Sorry the relevance of this is lost on me - I have never had a 50% increase on credit card charges, nor have I received letters through the door advising me of increases and decreases to credit card payments when the base rate changes.

ILW

suburbanwifey wrote: »

Because of the scenario I point out below, which cannot be denied because it happened to me and millions of others in the eact way described below:


Whenever BOE raised rates, my mortgage company raised rates. When the BOE started lowering rates, I immediately got a letter saying my rate was going down. If the BOE raised rates again, the mortgage company raised their SVR again ... see my point? if the SVR is not linked to a BOE base rate, then WHY did my mortgage company (and hundreds of others) raise or lower rates accordingly as to what the BOE was doing ????? Is it no wonder people assumed that SVR follow BOE rates?

Just because that is the way things tended to happen in the past, is guarantee that that is how they will continue to happen.
If you want to track BoE you get a tracker mortgage. Is it really that complicated?

moneymagnet_2

_Andy_ wrote: »

How did you want anyone to explain what 'variable' meant? Clue's in the word, surely

Yes of course - variable as in when the base rate changes is what I thought it meant. This has been the way it has always been done for the last 20+ years. Silly me to get so confused! As I said, and keep saying I employed an expert to do this for me, as I clearly don't know enough myself, and as the phrase goes you don't get a dog and bark yourself do you? Can anyone tell me if they are so well informed why anyone has an SVR mortgage if it is clear that they can charge you what they like? Doesn't sound like the most sensible option does it?

chalkie99

suburbanwifey wrote: »

Because of the scenario I point out below, which cannot be denied because it happened to me and millions of others in the eact way described below:


Whenever BOE raised rates, my mortgage company raised rates. When the BOE started lowering rates, I immediately got a letter saying my rate was going down. If the BOE raised rates again, the mortgage company raised their SVR again ... see my point? if the SVR is not linked to a BOE base rate, then WHY did my mortgage company (and hundreds of others) raise or lower rates accordingly as to what the BOE was doing ????? Is it no wonder people assumed that SVR follow BOE rates?

Because, in a nutshell, the SVR varies according to whatever it costs the lenders to borrow themselves at "wholesale" prices". Historically this has often followed the Bank of England base rate.

It just happens that although the BoE has kept the base rate low the lenders themselves are having to "buy" their money at higher rates from whoever will lend to them according t the perceived risk.

I'm no fan of the banks or mortgage companies but I think, in laymans terms, that this is the way it is.

moneymagnet_2

ILW wrote: »

Just because that is the way things tended to happen in the past, is guarantee that that is how they will continue to happen.
If you want to track BoE you get a tracker mortgage. Is it really that complicated?

No not complicated at all now that you have explained it. Why did my IFA not explain it to me is my question.

suburbanwifey

chalkie99 wrote: »

Because, in a nutshell, the SVR varies according to whatever it costs the lenders to borrow themselves at "wholesale" prices". Historically this has often followed the Bank of England base rate.

It just happens that although the BoE has kept the base rate low the lenders themselves are having to "buy" their money at higher rates from whoever will lend to them according t the perceived risk.

I'm no fan of the banks or mortgage companies but I think, in laymans terms, that this is the way it is.

Yes, as we are all learning, that is the way it is, you are correct. You were not correct to complain when we all assumed that the SVR of our lenders followed the movements of the BOE because as I pointed out, someone else pointed out and you agreed, that has historically been the case.

So that is why everyone is up in arms about all this, they are moving away from the norm (the lenders) and for once, NOT following the movements of the BOE base rate.

You asked why we would assume it would, then agreed with me as to why we would assume it would.

I rest my case and thank you for responding and explaining that to me.