Dot ComUnity Credit Union - ISA

Archi_Bald

Ed-1 wrote: »

"The new transfer guidelines also stated that the provider of the new cash ISA should backdate interest to the first day where interest no longer accrues on the funds being transferred, and should start paying the new interest rate from working day 16 at the latest. These key changes came into effect on 1 January 2011."

I am aware of this, but it just says should, not must, backdate.

Also, as I said, I am not sure DCU are members of the BBA, so they probably wouldn't be bound by the BBA guidance.

Ed-1

Archi_Bald wrote: »

I am aware of this, but it just says should, not must, backdate.

Also, as I said, I am not sure DCU are members of the BBA, so they probably wouldn't be bound by the BBA guidance.

It appears as step 3 of Appendix B in the HMRC ISA transfer guidance booklet (although as you say, it appears it is suggested best practice rather than a hard fast rule): http://www.hmrc.gov.uk/isa/isa-guidance-notes.pdf

"Interest on the transferred funds should be backdated either to the date on the cheque, inclusive, or to the date which represents ‘day 16’ of the transfer process, inclusive – whichever is earlier."

timmah86

Just out of interest, why isn't everyone who is thinking about an ISA going for this one? The interest and option to transfer in makes in better than the majority of them out there. Are there risks involved with using a credit union? Or something else I'm missing?

darren72

timmah86 wrote: »

Just out of interest, why isn't everyone who is thinking about an ISA going for this one? The interest and option to transfer in makes in better than the majority of them out there. Are there risks involved with using a credit union? Or something else I'm missing?

I've gone for this but I know a lot of people prefer to stick to well known brands, even if the protection on offer is the same.

Archi_Bald

timmah86 wrote: »

Just out of interest, why isn't everyone who is thinking about an ISA going for this one?

Fear of this being some sort of a scam.

Though it isn't a scam because they are properly registered with the FCA, and FSCS protection applies.

If everyone piled in, DCU could easily / would need to reduce their interest rate to next to nothing.

Like any other ISA, you need to keep your eyes peeled on it.

darren72

Ed-1 wrote: »

As part of an ISA transfer, the new provider is required by HMRC rules to backdate interest to the last day it did not receive interest with the old provider, so there should never be a day where the funds are not earning interest in an account as part of an ISA transfer.

Has anyone transferred to DCU and the transfer completed ? - What was the position in terms of loss of interest ?

Thanks in advance

mt77

darren72 wrote: »

Has anyone transferred to DCU and the transfer completed ? - What was the position in terms of loss of interest ?

Thanks in advance

My transfer has been finally completed today. My transfer request form was sent off on 17 April to DCU by post (only part that can not be done electronically), DCU then sent off the form to my former provider on 23 April. Former provider sent a cheque on 02 May and now displaying in my DCU account today, 07 May. About 4 days loss of interest from the point of the cheque being sent. Bear in mind the bank holiday weekends we have had during this period. Rough calculation on loss of interest = £10.00.

planteria

jimjames wrote: »

It might beat other ISAs but for smaller balances it still doesn't match what you can get from a current account at 5%.

i concur. and depending on circumstances, a Stocks & Shares ISA may be a better option for the ISA.

darren72

mt77 wrote: »

My transfer has been finally completed today. My transfer request form was sent off on 17 April to DCU by post (only part that can not be done electronically), DCU then sent off the form to my former provider on 23 April. Former provider sent a cheque on 02 May and now displaying in my DCU account today, 07 May. About 4 days loss of interest from the point of the cheque being sent. Bear in mind the bank holiday weekends we have had during this period. Rough calculation on loss of interest = £10.00.

Thanks. Whenever I've done transfers before the interest is normally backdated - was there any mention of that for you ?

mt77

darren72 wrote: »

Thanks. Whenever I've done transfers before the interest is normally backdated - was there any mention of that for you ?

Same here, I have always had interest backdated to the day when the previous provider sent the funds. So I hope so it will be the case here, though I have not asked DCU.