Fixed rate mortgage payment has gone up!!!!

kitkat1981

We have a 4 year fixed rate mortgage which started last April and when the standard variable rate went up in April we received a letter to say our monthly payment had gone up??? Very confused!! Anyone else experienced this? We have a mortgage agreement which states that our monthly payment will not change even if interest rates change. How can they now try to charge us £12 a month extra?

spadoosh

They're not doing, i think you might have read the form wrong.

I got a similar letter, it was about the standard variable rate and not the fixed rate mortgages. They are informing you because after your 4 years you will automatically be put on the standard variable rate. Just make sure you re-mortgage (or find the best deal) before the 4 years is up

kitkat1981

Thanks for reply but they have already put our mortgage payment up. We have complained and they say it is to do with the amount that is over the mortgage agreement we made and is on the standard variable rate. They have answered complaint and stand by this. I just don't understand so we have are taking it to the ombudsman. No one we know has every encountered this before but the bank say it happens occasionally. Just wondered if anyone had had this before.
I wish i had just read it wrong! Thanks for replying though

spadoosh

So have you made a payment at the higher rate?!

I really cant see how this has happened?!?! Just go into the bank with your original mortgage agreement.

Unless youve been given the wrong mortgage at the begining but if your paperwork states 4yr fixed there really is nothing they can do you have agreed to pay that price for 4 years.

Not a mortgage expert but there are plenty on here, if its something that happens from time to time theyll be along to help you out soon.

alfiesmum

Is there perhaps a second mortgage that was on the variable rate, not included in the fixed rate? Taken out for home improvements perhaps, and you thought it was added to the original mortgage, but it's actually different terms slightly?

kitkat1981

Thanks for both replies. Hopefully someone will know something about it. We haven't taken out another mortgage or added anything on the mortgage. The only thing we did was make our 10% repayment in March before we changed deal to a 4 year fixed rate in April. We have also been charged a £2.5k early repayment fee for the 10% which I confirmed with the bank was ok to make so we are in dispute about that too. They have offered us £75 compensation as it took them over 6 weeks to investigate. Which we are obviously refusing. We have asked them to investigate again as their reply does not make sense. They are linking the erpc to the rate change even though the repayment was made in march and we changed deal in april. Hopefully someone will know why. Thanks

kitkat1981

We realise now that the extra payment is to do with the £2.5k charge they gave us for an early repayment charge even although we paid 10% in the rolling year on our old mortgage deal which was confirmed with the bank. They are saying the charge is to do with this payment and also the new deal we got yet we made the payment on the 4th March and our new deal began on the 1st April. We understand now that the payment changed as the the 2.5k fee is on top of the mortgage agreement. Now the argument is that the erpc is unfair and needs removed which they are refusing to do. nightmare

Gentoo365

It sounds to me that you are not sure exactly what the terms of your mortgage were at the various stages of before, during and after the switching between products.

You may need to read the terms clearly to see where the breach is. Maybe the 10% rule is different to what you thought. Maybe you waived that right when you accepted the product switch. Maybe you paid the 10% too early.

The ombudsman will rule in the banks favour if they have adhered to the terms and conditions. So your best bet is to get a complete understanding of what went wrong (ask a trusted friend to read though the terms to see if they can find out). Then write to the bank complaining that the situation was not made clear to you over the phone when you made the payment and you feel you have lost out financially due to the confusion.