Is the interest paid wrong

suze200

Please can someone confirm that I am not being thick. The interest paid on a Halifax ISA fixed at 4.25% for 3 years looks wrong. Interest is supposed to be paid annually. Don't know why 2 amounts were paid in April 2012 but together they only come to only about 0.5%. The statement looks like this.


Date Description Type In (£) Out (£) Balance (£)

19 Apr 12 INTEREST (GROSS) 0.94 5,260.12

05 Apr 12 INTEREST(GROSS) 26.27 5,259.18

05 Apr 11 Interest DEP 131.46 5,232.91

05 Apr 10 Interest DEP 1.45 5,101.45

01 Apr 10 BRANCHOPENING 5,100.00 5,100.00

Ark_Welder

Doesn't look like you have had a rate of 4.25% at any stage, more like 2.58% for both 2010 and 2011.

2011: 131.46 / 5101.45 = 2.577%
2010: 1.45 / 4 * 365 = 132.31

So annualised interest on the (assumed) 4 days in 2010 is roughly the same as the interest paid in 2011. Looks more like a 2-year fix (or Base Rate + 2% for 2 years) then the rate drops.

Check your paperwork to confirm that it is for a 3-year fixed rate at 4.25% then get onto your branch.

suze200

Definitely is 3 year fixed. Just copied this from on line statement

ISA SAVER FIXED 3Yr, Interest rate: 4.25% Gross

waiax73

The best thing to do would be to contact halifax directly (remember to take your papers with you).... This doesn't seem right at all.

Good luck

SnowMan

Looks possibly like the Halifax ISA direct reward rates from around that time which initially paid 2.6% pa AER for 12 months with interest paid on 5th April.

Since that first 12 months the interest rate has clearly dropped to about 0.5% AER based on those figures.

So not a 3 year 4.25% fixed rate account at least in terms of interest paid.

Suggest you take it up with Halifax.