Barclays/Woolwich - Mortgage Reserve being Withdrawn

dunroving

getmore4less wrote: »

What is the od limit on your reserve account?

I still have mine and they never fixed the problem you can borrow back all the capital paid off, it is still going up.

Reinstating a reserve that has been removed will be a lot harder.

I don't know. As I was a responsible customer, I didn't use the reserve so didn't notice when it went to zero. I just vaguely remember letters telling me my reserve had been increased, etc. I need to go back into my bank records (I keep everything) to see what the situation used to be.


One of their customer-service people at the local branch said the reserve amount can be reinstated - I just have to apply and he said he thought it was a £100 fee. However, the Woolwich people on the phone had previously told me the facility was no longer available to existing customers (this doesn't agree with what Barclays own Web pages say). Also, he other customer services rep who called back to make an appointment with me was studiously avoiding any discussion of the reserve account.


I have been with Barclays for over 35 years, never overdrawn or late with a payment, always had good credit.

getmore4less

The od limit should be on the statements.

When the letters came I made sure we kept ours.

I should add we are offset so the rate was mortgage rate so they may not have been so keen to close those.

The problem for Barclays was reserves have no payment plan they were not even interest only. They needed to shut them off as they were a big hidden problem

dunroving

getmore4less wrote: »

The od limit should be on the statements.

When the letters came I made sure we kept ours.

I should add we are offset so the rate was mortgage rate so they may not have been so keen to close those.

The problem for Barclays was reserves have no payment plan they were not even interest only. They needed to shut them off as they were a big hidden problem

They are somewhere in the attic.


The Barclays pages indicate that the interest on the reserve facility would be the same as the mortgage interest rate (1.09% for me), so it is clear why they closed down this service.


http://ask.barclays.co.uk/help/mortgages_homes/mortgage_rate


Nothing to do with prudent lending and everything to do with keeping shareholders happy.


Other existing pages about the reserve facility:


http://ask.barclays.co.uk/help/mortgages_homes/reserve_work


http://www.woolwich.co.uk/mortgages/additional-borrowing.html


- I plan to print off and take with me some of these pages when I go in for my appointment.

getmore4less

If the rate is the same that should(would suggest) be an offset.
If it is I am not they can operate those without a reserve but they can reduce the a OD limit.

dunroving

Just a couple of updates to this thread.


I found all my old statements but I don't have any for the mortgage reserve account. I assume that because I wasn't using it they didn't send statements. I looked online as my statements have been online for at least two years but similar thing - no statements for the reserve account.


Coincidentally, today's Sunday Telegraph has an article on how many mortgage lenders are shaft consumers who simply want to port their mortgage to another property, often even downsizing, so reducing the loan amount, and banks are saying "Computer says no".


http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/11456088/Mortgage-chaos-for-thousands-of-people-moving-home.html


The excuse given is usually to do with new mortgage credit check requirements, but the FCA allows banks to apply the "old" requirements, especially if the customer is not looking to increase the loan amount or extend the loan period.
This is the same excuse Barclays are giving me for not allowing me to use my mortgage reserve account - but they are willing to give me an unsecured loan, at a high interest rate.


As the ST says, it seems to come down to banks seeing a cop-out way to increase interest rates on people who currently have a decent interest rate.

Thrugelmir

dunroving wrote: »

As the ST says, it seems to come down to banks seeing a cop-out way to increase interest rates on people who currently have a decent interest rate.

That's just the rubbish that gets spouted by the media who fail to grasp the much bigger picture.

I have been with Barclays for over 35 years, never overdrawn or late with a payment, always had good credit.

Unfortunately Barclays aren't possible to make decisions on the basis of hindsight on a micro level. Barclays will set policy on a macro level from board level downwards to comply with regulatory requirements and the direction that they are taking the bank in, post the GFC era.

dunroving

Thrugelmir wrote: »

That's just the rubbish that gets spouted by the media who fail to grasp the much bigger picture.



Unfortunately Barclays aren't possible to make decisions on the basis of hindsight on a micro level. Barclays will set policy on a macro level from board level downwards to comply with regulatory requirements and the direction that they are taking the bank in, post the GFC era.

I guess the days of sensible, individual-level customer decisions are gone, then.


If you read the Telegraph article, none of the case studies make any logical sense. What is the point of giving the opportunity for customers to sit in a branch and discuss things if all the person at the other side of the desk will do is plug information into a computer and let a macro-level algorithm spit out an answer?


I think it's the banks' inability to grasp the "smaller picture" that is the bigger problem.


As per my previous post, the FCA allows the banks to apply different criteria to people with existing mortgages ... so the FCA regulatory requirements allow for decisions on people like the case studies in the article, that lead (for example) to someone being unable to move house in order to look after their elderly father who has dementia.


Just one or two quotes from the article:


"Ray Boulger, of mortgage brokerage John Charcoal, said ...


Banks doing this are acting legally, but the question is whether it is morally right.


"If someone has always maintained their mortgage repayments, stopping them from taking their deal to a new house is illogical and a classic case of unfairness." "


and


"A spokesman for the FCA said some lenders were "not applying the [mortgage market review] rules correctly".


The regulator said banks were wrong to force customers to undergo affordability checks if they wanted to "port" a mortgage and were not increasing their borrowing or the mortgage term. "


... not sure how the above illustrates board-level decisions "... to comply with regulatory requirements" ...

getmore4less

if you have an offset you should be getting monthly mortgage statements that say what the reserve OD limit is on pg.2.

if not offset then the interest rate on the reserve will most likely be at the SVR not the mortgage rate.

Thrugelmir

The regulator said banks were wrong to force customers to undergo affordability checks if they wanted to "port" a mortgage and were not increasing their borrowing or the mortgage term. "

New mortgage applications have always required full checks. Hence my previous comment about the media not understanding the topic.

"A spokesman for the FCA said some lenders were "not applying the [mortgage market review] rules correctly".

This is a statement that has to be put into context in which the FCA was responding.

"Ray Boulger, of mortgage brokerage John Charcoal, said ...


Banks doing this are acting legally, but the question is whether it is morally right.

Ray Boulger doesn't run a bank nor I suspect does he have the capabilities of doing so. Totally different to expressing personal opinions as a mortgage broker. I would say JC's fees aren't moral either. Certainly not cheap to use.

"If someone has always maintained their mortgage repayments, stopping them from taking their deal to a new house is illogical and a classic case of unfairness." "

Complete tosh if the quote is taken in isolation. Self certification is one reason for the problems that many lenders encountered. Those lenders that did under write such business no longer exist as mortgage lenders. Those that didn't survived.

dunroving

Thrugelmir wrote: »

New mortgage applications have always required full checks. Hence my previous comment about the media not understanding the topic.



This is a statement that has to be put into context in which the FCA was responding.



Ray Boulger doesn't run a bank nor I suspect does he have the capabilities of doing so. Totally different to expressing personal opinions as a mortgage broker. I would say JC's fees aren't moral either. Certainly not cheap to use.




Complete tosh if the quote is taken in isolation. Self certification is one reason for the problems that many lenders encountered. Those lenders that did under write such business no longer exist as mortgage lenders. Those that didn't survived.

Have you read any of the case studies, or the article? I think all of your points are addressed in there.