Nationwide "borrow back" - won't give me my money without telephone assessment

apples1

We have had our Nationwide mortgage for many years. Under its terms you can overpay without penalty and also "borrow back" that overpayment at any time. I have a £50k overpayment pot against the mortgage and have drawn on it a couple of times. I have recently requested £2.5k of my £50k by writing to them with both our signatures etc as per the terms. Usually the funds are moved to my current a/c within 2-3 weeks. Now, 3 weeks after my request I have received a letter saying new procedures dictate that we can't "borrow back" money without a 15 minute telephone assessment and further checks to see whether we meet their eligibility criteria. It states that this may include us having to provide details of our income and expenditure etc and we must have all such info to hand when we call. It also states as it's a joint mortgage both of us must complete these assessments.

That money is ours. We overpaid on the basis we could draw it back as needed. This time it's for a medical bill.

I feel furious that they are putting hurdles in the way and that medical bill has been paid on my credit card which now falls due before I have chance to have my money as the letter states it will be 10-12 working days after the assessment and any other checks are complete before I get the money.

Can they really say no? I have never ever missed a mortgage payment and have a perfect credit rating.

apples1

Bump so I can sleep without worrying. Has anyone any experience of this at all?

comeandgo

There was a similar question regarding Nationwide a few weeks ago and it was said nationwide were correct in what they were now doing.

comeandgo

Sorry not IT savy but if you look on the mortgage forum under the date 2nd Feb you will find the conversation I was thinking about. It actually may not be so bad as my other post may suggest.

Goldiegirl

I'm not up to date on current procedures, but I understand lending procedures are being tightened up by all lenders ahead of new legislation coming in in April.

So Nationwide need to make sure you can afford to pay back the funds you want returned.

Just because you could afford it in the past, doesn't mean you can now - your situation could have changed.

They are not putting up unnecessary hurdles - just doing what they now have to do.

Thrugelmir

Mortgage market review comes into formal effect on the 26th April. In preparation lenders are already bringing their procedures into line with the regulatory requirements.

Also on 1st April unsecured lending also comes under remit of the FCA. So there'll be a seismic change in the way lender operate with regards to finance from mortgages, to pay day loans, to credit cards.

The key words will be responsible and affordable lending.

apples1

Thank you all for the replies.

I spoke to them today and ended up asking to take out the whole overpayment fund. No matter how much I think it through I can't feel secure knowing they could stop me having my savings should I want or need them.

They admitted they had not notified customers of the change in procedure and yet when I politely explained how I felt I just got the scripted response repeated on loop! The terms of my mortgage state I can have any overpayments back on request but I was subjected to a barrage of questions as if I were applying for new borrowing! Income, expenditure, planned retirement age, other loans, credit card balance, number and ages of children, everything.

Feel I have no choice but to (hopefully) get my overpayment out (increasing my monthly mortgage pmt by nearly £200!) and put it in savings a/c. Not a financially good move but I no longer feel my savings are safe there :-(

Thrugelmir

apples1 wrote: »

Not a financially good move but I no longer feel my savings are safe there :-(

Unlikely that NW will go bust.

teabelly

It might be a good idea to checkout offset mortgage providers. That way you keep that money in a linked savings account and it is yours whenever you need it and you can increase savings to reduce mortgage outstanding whenever you like.

fewcloudy

apples1 wrote: »

Thank you all for the replies.

I spoke to them today and ended up asking to take out the whole overpayment fund. No matter how much I think it through I can't feel secure knowing they could stop me having my savings should I want or need them.

They admitted they had not notified customers of the change in procedure and yet when I politely explained how I felt I just got the scripted response repeated on loop! The terms of my mortgage state I can have any overpayments back on request but I was subjected to a barrage of questions as if I were applying for new borrowing! Income, expenditure, planned retirement age, other loans, credit card balance, number and ages of children, everything.

Feel I have no choice but to (hopefully) get my overpayment out (increasing my monthly mortgage pmt by nearly £200!) and put it in savings a/c. Not a financially good move but I no longer feel my savings are safe there :-(

You did the right thing as far as I'm concerned. This just shows again that there is nothing whatsoever to stop these chimps changing the rules as they go along, as and when it suits them, without even the decency to let you know.

It's nowt to do with whether NW might go bust or not; they are not bust now but OP can't take back his money as agreed. Next time he tries it might be much more difficult, or on a whim they might just say it's not possible at all, no-one can stop them. And doubtless the sycophants will be on explaining why it's all perfectly reasonable...

Hopefully if you are well into your mortgage there will be ways to alleviate the extra monthly cost. There are quite a few on here who would tell you that you are better saving than overpaying a mortgage anyway, depends on all the relevant rates.

Well done you on making a stand.

apples1

I had an e mail today to say the borrow back (even that phrase annoys me!) has been processed funds will be with me in five working days.

I have had a Nationwide Mortgage since 2003 yet feel really betrayed and let down by this. Having been right through my mortgage file I can't find the T&Cs about over payments so does anyone else have them? Can't find on their website either. I just don't understand how they can make a change to the terms without notifying customers. Does that not put them in breach of something? Have calculated we'd be £400 - £600 a year worse off by putting the overpayment money elsewhere (into savings instead of against the mortgage).

Don't want to ditch Nationwide mortgage as a mortgage product as we are on BMR at 2.5%