C&g svmr

Grampus8

Hi chums,

C&G have a Standard Mortgage Variable Rate which only applies to those whom took deals before June 2010.

It purports to "guarantee that the base rate will be no more than 2% above the BOE base rate"

Do you know if they can raise this one?

G

Thrugelmir

If base rate were to be cut to .25% or lower then highly possible.

Grampus8

Thrugelmir wrote: »

If base rate were to be cut to .25% or lower then highly possible.

How do you mean?

Thrugelmir

Lloyds could not afford to cut rates to 2.25%.

A quarter point cut would wipe £2 to £3 billion off their bottom line profit alone.

With their borrowing costs rising as well the squeeze would force a change in policy.

opinions4u

My view is that the link to base rate would have been broken already if they had a watertight legal way out of it.

While I'd never say never, I think it will continue to do what it says on the tin.

Thrugelmir

opinions4u wrote: »

My view is that the link to base rate would have been broken already if they had a watertight legal way out of it.

Being partly nationalised its the last resort I would say.

Though there may come a time when it has to be increased.

Once the deleveraging process is complete. The lending market is going to look very different today.

Grampus8

Thrugelmir wrote: »

Being partly nationalised its the last resort I would say.

Though there may come a time when it has to be increased.

Once the deleveraging process is complete. The lending market is going to look very different today.

They introduced two new "SVR's" afterwards. In panic I imagine.

Always thought that C&G's and Nationwide's were untouchable.

Thrugelmir

Grampus8 wrote: »

Always thought that C&G's and Nationwide's were untouchable.

There's a breaking point for everything.

We've many years of financial adjustment ahead.

Grampus8

Thrugelmir wrote: »

There's a breaking point for everything.

We've many years of financial adjustment ahead.

Indeed. We shall see I suppose.

kingstreet

I would imagine LBG is looking very hard at this.

It has to divest itself of C&G in the wake of the Halifax takeover and I would imagine a buyer is likely to be interested in a more profitable mortgage book.

Thrugelmir

kingstreet wrote: »

It has to divest itself of C&G in the wake of the Halifax takeover and I would imagine a buyer is likely to be interested in a more profitable mortgage book.

Are some of the C&G branches being sold as part of the Co-Op deal?

What's being overlooked is that the Co-Op may well revise the SVR on mortgages taken over. As TMW did when acquiring the BOI mortgage book.