MSE News: When is a tracker mortgage not a tracker?

DannyboyMidlands

Pride doesn't come into it.

I just think it weird to sign up to a mortgage that doesn't track the BoE base rate and then be "shocked" to find out that it doesn't erm track the BoE base rate.

If I go to Tescos to buy some tomatoes I am not gonna be "shocked" to later see tomatoes in my bag.

The_J

You are, of course, assuming that these things are clear and bank staff are honourable. Take the Barclays Bank Base Rate, it has never diverted from the BOE Base Rate so bank staff were regularly telling customers that it followed the base rate if they asked the question.

So far it has and, in my opinion, will always continue to do so at the enormous benefit of those who took the +0.17, +0.18, +0.49 etc. term trackers but it's not as black and white as you'd like.

DannyboyMidlands wrote: »

If I go to Tescos to buy some tomatoes I am not gonna be "shocked" to later see tomatoes in my bag.

What if you went to the deli, asked for olives, they put it into a box and when you got home they were prunes?

If you like prunes a lot, and you were charged for olives (which are less expensive) you would be happy.

If you hate prunes then you obviously wouldn't be a happy bunny.

shortchanged_2

This news has made you a bit twitchy The J.

You were very confident only a few days ago that lenders couldn't do diddly with people on BoE trackers.

DannyboyMidlands

Fair point but still, with the large sums involved, surely people would take 5 mins to check it out online rather than take some monkeys word for it? I would anyway and then it would be black or white.

The_J

shortchanged wrote: »

This news has made you a bit twitchy The J.

You were very confident only a few days ago that lenders couldn't do diddly with people on BoE trackers.

I think I specifically said above I was confident they would never change it. The revenue raised vs the brand damage and complaint cost would not be worth it.

I'm anti-debt, even though debt has made me rich via my profession I am well placed to see it's effects. It's important for people to understand that they are not entitled to debt, that they are imprisoned by it and that they should seek to remove themselves of it at the earliest convenience.

Premier_2

As an example, all Woolwich (owned by Barclays) tracker mortgages are linked to changes in the Barclays Bank Base Rate (BBBR).

The Barclays Bank Base Rate typically follows the Bank of England Bank Rate but it is not guaranteed to do so. (historically it always has)

Now if Barclays were to raise their BBBR, then Barclays savers would rightfully be looking to see an increase in their savings interest rates


Edit: This is an interesting post from 2007

MissScarlett wrote: »

I have just had a mortgage offer from Woolwich(Barclays) and it confirms that-: All references to the Barclays Bank Base Rate in your offer document should be taken to references to the Bank of England Base Rate.

I did ask the question at the time that I arranged the mortgage as to why it was Barclays and not the BOE base rate that the mortgage tracked and was advised that it's one and the same and it has never differed from the BOE rate. Hope that puts your mind at ease.

http://forums.moneysavingexpert.com/showpost.php?p=6206959&postcount=2

Could be the new mis-selling scandal if they don't keep to the terms it was originally sold under

Edit2: ... and here's the evidence to support the above post by MissScarlett
http://forums.moneysavingexpert.com/showpost.php?p=16477783&postcount=4

Barclays Bank Base Rate
Interest on tracker rate mortgages is charged at a set margin above or below or equal to the Bank of England Base Rate. Interest rate changes on existing tracker rate mortgages take effect from the first of the month following a change to the Bank of England Base Rate. All references to the Barclays Bank Base Rate in your offer document (where the reference is to 'Barclays Bank PLC’s Base Rate') and Key Facts Illustration document (where the reference is to 'our Base Rate') should be taken to be references to the Bank of England Base Rate.

http://web.archive.org/web/20071230085115/www.personal.barclays.co.uk/BRC1/jsp/brccontrol?task=articlegroup&value=6228&target=_self&site=pfs

betmunch

DannyboyMidlands wrote: »

Some mortgage holders who believe their tracker rate is pegged to the Bank of England base rate.........should have paid more attention when they signed up.

Cant believe I am agreeing wholeheartedly with DannyBoy!!!

This is a complete non-story for me, I cant believe it was even published.

Every client I have EVER done a mortgage for has been told what their product does for the promotional period and what the revert rate is and what its linked to.

If its a Woolwich mortgage then the client was told its tracking BBBR not BoE Base Rate. If Woolwich later wish to vary BBBR from the Boe Base Rate then thats their look out.

betmunch

Premier wrote: »

As an example, all Woolwich (owned by Barclays) tracker mortgages are linked to changes in the Barclays Bank Base Rate (BBBR).

The Barclays Bank Base Rate typically follows the Bank of England Bank Rate but it is not guaranteed to do so. (historically it always has)

Now if Barclays were to raise their BBBR, then Barclays savers would rightfully be looking to see an increase in their savings interest rates


Edit: This is an interesting post from 2009

http://forums.moneysavingexpert.com/showpost.php?p=6206959&postcount=2

Could be the new mis-selling scandal if they don't keep to the terms it was originally sold under

If they have published something stating that BBBR should be considered the same as BoE then I dont think they have the wiggle room to vary it - making the story even more of a non-story!!!!

brit1234

The_J wrote: »

Their money, their rules.

No it's my money and if I am going to lend it to them so they can do business then I want them to give me a better deal for it especially taking inflation into account.

Mortgage and saving rates are too low.

The_J

betmunch wrote: »

Cant believe I am agreeing wholeheartedly with DannyBoy!!!

This is a complete non-story for me, I cant believe it was even published.

Every client I have EVER done a mortgage for has been told what their product does for the promotional period and what the revert rate is and what its linked to.

If its a Woolwich mortgage then the client was told its tracking BBBR not BoE Base Rate. If Woolwich later wish to vary BBBR from the Boe Base Rate then thats their look out.

But betmunch, you are a nice guy, an honourable man in an honourable profession, your wealth is a reflection of your honesty. Now compare yourself, a pillar of the community, to the scum drain monkeys who work in bank branches.

Surely, the fact that you had to specifically point out that it was BBBR not BOEBR, and you remember it as such, suggests that there could be a problem?