MSE News: Co-operative Bank: how safe is it, after Moody's downgrade?

jamesd

Hk12 wrote: »

Is there anything I should be worried about?

The uncertainty, if it's the right product for you there's enough reason to continue.

Hk12 wrote: »

Can our mortgage rate be put up if they are bought out by smeone else?

Not during the time of the fix, unless there is an exceptional conditions clause, there might be. After the fix it probably reverts to SVR and that could be the SVR of any buyer.

Hk12 wrote: »

Is our deposit safe that we put down on the house?

So long as the house is insured and the value doesn't drop. That deposit doesn't go to your lender, it goes to the seller of the property and becomes equity in the home owned by you. Falling house prices reduce your equity, rising prices increase it.

Hk12 wrote: »

Is our house safe or could it be an asset that creditors can claim back?

A mortgage lender doesn't get to say repay the mortgage now. The lender and any buyer have to wait until the end of the mortgage term or until you choose to remortgage or sell. It's not an overdraft or credit card balance where that is possible. The house is vulnerable if you fail to keep up your mortgage payments and it gets repossessed but that sort of things is unrelated to whether the Coop is in financial trouble or not.

Forget worrying about the house, just pay your mortgage and that'll be fine. The biggest risk is if the loan gets sold and the SVR after the end of the fixed period is higher.

MsSupertech

I'm a very happy Smile current account customer and would hate to lose this account BUT because computers are never infallible I've always had an alternative current account. If Co-op were to fail (and I really doubt this is likely) I could switch DDs etc quite easily. I doesn't make sense to put all your eggs in one basket - just remember the number of ATM problems there have been in the last year or two...

ComeTheRevolution

I knew something was up a year ago when they tried to repossess my house while writing to me that there was no county court hearing against me. Judge ordered them to release a full SAR and they continued to refuse me. Customer Services sat on my requests for help with what the hell was going on and then wrote that I should just go to the Ombudsman for answers. It was a nightmare and I had to indemnify for the sake of sanity. 10 months on .... they still haven't removed their charge on the property.

Bottom Line: Britannia Mortgages were viewed undesirable.

It's taken this long to recover from the stress in order to face looking at the mess by writing to the Ombudsman but I shall, if only to get them to remove their hypocritical little name from MY registered land.

I write this in full knowledge of our laws of libel.

littlemoney

I am in the position of having a number of savings account with Britannia and my current account with co-op. I am below the limit but I have other savings account, with separate organisations, for which I had to link to my current account should I wish to withdraw money from so there could be times when I will exceed the 85,000 limit. Should I open another current account. It seems that most current accounts want you to also move your all your direct debits and credits when opening. Is there a current account I can open without moving the direct debits etc?

innovate

littlemoney wrote: »

I am in the position of having a number of savings account with Britannia and my current account with co-op. I am below the limit but I have other savings account, with separate organisations, for which I had to link to my current account should I wish to withdraw money from so there could be times when I will exceed the 85,000 limit. Should I open another current account. It seems that most current accounts want you to also move your all your direct debits and credits when opening. Is there a current account I can open without moving the direct debits etc?

Yep, quite a few current accounts about for which you don't need DDs. But even if you fancy one that does require DDs (such as Halifax), you can relatively easily set up small DDs for the specific purpose - https://forums.moneysavingexpert.com/discussion/4168667.

bendipa

alastairq wrote: »

Or, is it chagrin at the probability that Co-op BAnk's core customer base is more likely to have been found amongst the country's LAbour supporters, than from within the ranks of the Tories, or tory-wannabe's?

Not too sure what being a Co-op customer has to do with being a supporter of the Labour Party.

What is of concern to me, more than a mythical credit rating...is the real possibility of all current accounts..[especially basic accounts] being subject to charges for administration?

That would have to be a pretty brilliant move in how to lose customers quickly, since other organisations such as building societies would never charge for an account being in credit. and never have done. So no... highly unlikely the Co-op would charge personal customers if they keep their account in credit.

zzzt

This does worry me slightly. Well, it's more of a shame really. I'm not overly worried for my money, because it's less than £85,000 and as I understand it they aren't in as bad a shape as some other banks, whom people lost nothing with in the end.

My main current account is with smile and I'd like to keep it that way. I do have a backup current account that I keep a small amount in for emergencies (e.g. in case I can't access my main account, which has never happened), but I might top it up just in case.

robs349

nilrem wrote: »

It does not matter what sort of account, you are protected upto a max of £85k in an institution.

The risk of anyone losing money with a Co-op account is less than minuscule even with more than £85k invested with them.

Just look at the financial situation RBS were in, much worse than the Co-op yet no savers lost money. People should stop worrying.

the total fund amount per year under the compen scheme is 4 billion, about 1000 for 4 million people. it's nothing more than a confidence boosting scam to stop you running to the bank.
cyprus was a shout for the hard of hearing! anyone who thinks their 85 grand cash will be safe in a really serious economic crisis (the last one was just a taster) is seriously deluded. have a look at some history- 1929- the south sea bubble- john law french land bank - tulips etc. if you're going to keep your hard earned you better start educating yourself about how it works, the nice government people aren't going to save you! i mean seriously? you believe this? they can't possibly, where would the money come from? trillions of it! don't get suckered with the newspeak, its not a triple dip or any other euphemism, it's the crest of a huge depression. there. i said the dreaded word! it really angers me that this site and the media at large keep peddling the 85 grand'll be fine, don't worry fairy tale. you know what they call the easy start etc mortgages? the neutron mortgage.
the houses are still there but all the people are gone!!
ok i'm off, now read all the ah but posts that follow this. actually, don't, go find out for yourself. good luck.

robs349

JuicyJesus wrote: »

Amuses me how everyone's panicking. RBS, Lloyds, Halifax etc were all in far worse shape than the Co-op currently is but they didn't fall over. Neither will the Co-op.

yeah? we'll see how amused you are in say 5 years. and actually, they did fall over. but they've been propped up with paper now so you can't see the rubble. the co-op will be ok, but not for your reasoning, they were solid to begin with and they've dumped the lloyds deal. so lloyds are going to get you to buy it on the market instead! thank goodness for car boots, ie. the public!

antrobus

JuicyJesus wrote: »

Amuses me how everyone's panicking. RBS, Lloyds, Halifax etc were all in far worse shape than the Co-op currently is but they didn't fall over. Neither will the Co-op.

Actually RBS and the Halifax (as in HBOS) did fall over. Large amounts of government money were required to get them back up on their feet again. The concern is that the Co-Op might require the same treatment.

Personally I think it's unlikely unless there's a run on the bank, but I wouldn't rule out the possibility however slim.