First Direct Offset criteria change

bingham40

It appears First Direct have changed their criteria around offset mortgages. You now need to earn over 50k single or 75k for a joint mortgage regardless of the LTV. I discovered this today when applying to move my mortgage to First Direct, it only changed last week.

Why am I moaning about this? I've been a first direct customer for 10 years and have had a mortgage with them before, when I moved house two years ago I was contracting at the time and they wouldnt offer me a mortgage on my new house despite it only being a 22% LTV (72k on 330k house). No amount of moaning or asking to speak to an underwriter would get them to budge so I took a mortgage with Halifax, who offered me a 300k mortgage. At that point I was frustrated but now i'm furious as I am an employee again rather than a contractor and they've changed the rules again.

I want a mortage of 40k (my salary is 47.5k) and have savings of 20-30k depending on the time of month and year so will only be paying interest on a max of 20k, sometimes as little as 10k. I like the comfort of having those savings available to me should I need them which an offset mortgage provides.

In reality there are plenty of other options open to me but I needed to have a rant somewhere about First Direct. I love their customer service for every other aspect but their inflexibility on mortgages drives me mad. I've got to be one of the lowest risk customers around.

kingstreet

They are probably looking to get bigger mortgages, looking at those income figures. It's as much about profit, as it is about risk.

bingham40

kingstreet wrote: »

They are probably looking to get bigger mortgages, looking at those income figures. It's as much about profit, as it is about risk.

Agreed. As they pride themselves on customer service though I think it should also be about supporting your long term customers. But perhaps i'm being too naive.

It seems ridiculous though to put a minimum income on a product thats not related to the loan amount.

Thrugelmir

£40k loan advance isn't really worth their time. As will earn them little over the remaining term of the mortgage. Even more so will an offset facility.

pamelab21

I agree, we have banked with them for 5 years now, currently have an offset mortgage with them that is coming to an end and about to change to their SVR, however we no longer qualify for a new offset mortgage as they changed their rules after we took ours out, meaning we have now rearranged with Britannia on a fixed rate repayment mortgage, we will now have to move all our savings away from them to get a better rate etc. I did call them but they were not interested really. Obviously looking for the BIG earners these days.
It's a shame as they were good to deal with when needed.

Gambler

pamelab21 wrote: »

I agree, we have banked with them for 5 years now, currently have an offset mortgage with them that is coming to an end and about to change to their SVR, however we no longer qualify for a new offset mortgage as they changed their rules after we took ours out, meaning we have now rearranged with Britannia on a fixed rate repayment mortgage, we will now have to move all our savings away from them to get a better rate etc. I did call them but they were not interested really. Obviously looking for the BIG earners these days.
It's a shame as they were good to deal with when needed.

I can't quite believe I am reading this !!

I uumed and aaahed about whether to go for the Britannia 5 year fix but decided I preferred to stay with the offset facility.

My five year fix is up in June this year. I was thinking of staying on the SVR or changing to a 3 yr fix or 2 year tracker.

Can't access the FD website at the moment. Am I right in thinking my only options are to stay on the SVR or move to another provider?

Thanks

bingham40

Gambler wrote: »

I can't quite believe I am reading this !!

I uumed and aaahed about whether to go for the Britannia 5 year fix but decided I preferred to stay with the offset facility.

My five year fix is up in June this year. I was thinking of staying on the SVR or changing to a 3 yr fix or 2 year tracker.

Can't access the FD website at the moment. Am I right in thinking my only options are to stay on the SVR or move to another provider?

Thanks

Yep if you dont meet the new criteria. They will still offer other mortgages but not the offset one as they class it as an "interest only" product

goosander

I'm pretty annoyed to be reading this since I changed banks to First Direct last year because I wanted an offset mortgage (house purchase fell through & mortgage offer since expired).

I wonder if their is wiggle room if you have a large deposit?

Gambler

bingham40 wrote: »

Yep if you dont meet the new criteria. They will still offer other mortgages but not the offset one as they class it as an "interest only" product

Problem is their traditional 5 year fix has a £2k fee. I wish they had changed their criteria last week I would have gone for the Britannia :mad:

Bluebell1000

Yikes, we're in the process of moving our mortgage to FD at the moment on their offset product, and wouldn't qualify under their new criteria. If they've already said yes and had the paperwork back etc, valuation ok, legals in progress, is there any possiblity they might change their minds?

maninthestreet

bingham40 wrote: »

As they pride themselves on customer service though I think it should also be about supporting your long term customers.

The financial industry does not reward customer loyalty.