Has Abbey's Direct ISA rate dropped

gibbyni

i opened a abbey direct ISA a few weeks back ant the rate was 6% and increased to 6.25% when you got to 9k (Or something around there). However i was just on there site and it now says 5.83% and 6.08% for over 9K. On there icons to get to the ISA it still says up to 6.25%.

Am i missing something here or are they dropping it??

TomsMom

Both hubby and I should be on the max rate for our Abbey Direct ISAs too. Thanks for pointing this out. I think it's worth a phone call tomorrow to double check. The icon stating up to 6.25% that leads to the Direct ISA page has maybe not been changed yet so that's quite misleading as it definitely says 6.08% for over £9,000 as from 1st September.

It is also coming up on moneysupermarket.com list of ISAs as 6.08%.

I thought that we would have had an e-mail advising of the rate change

roddydogs

Hope not youve got me worried, havnt had a notice since the 6.25% one!

SalsaDanca

www.abbey.co.uk wrote:

Rates are effective as at 1 September 2007

The rate you receive will be between 5.83% & 5.79% gross p.a/AER for balances of £1+ and 6.08% & 6.04% gross p.a./AER for balances of £9k+ depending on when you open your Direct ISA.

It looks like you are still getting the 5.75% + 0.5% bonus, they've just recalculated the APR to show that the bonus runs out in less that one year's time.

The 0.5% bonus ends on the 1st May 2008, 7 and a half months from now. If you opened your Direct ISA on 1st September, you would get the bonus for 8 months. 0.5% * 8 / 12 = 0.333%. 0.333% + 5.75% = 6.083%

If you open the ISA on 30th September, you will get the bonus for 7 months.
0.5% * 7 / 12 = 0.292%. 0.292% + 5.75% = 6.042%

I expect that Abbey will recalculate the APR every month until the bonus rate runs out.

Regards,

Rob

roddydogs

Abbey HAVE dropped their interest rate! they have done this without notice which is against the "banking Code" (even the girl on the phone admitted this!)dont know what the previous reply was about-THEVE DROPPED THE RATE! complain, like im going to.:mad::mad:

PBA

The rate has not dropped. You still get 6% or 6.25%.

However, as the rate includes an introductory bonus until 1 May 2008. Therefore if you open the account now you won't get the bonus for a full year. AER is the rate you get if you put money into an account now and leave it for a full calendar year. Therefore the current AER assumes you get 6% or 6.25% until 1 May, and then 5.5% or 5.75% until September.

Rob is right, the AER on the website will change on the 1st of every month until the bonus runs out.

gibbyni

PBA wrote: »

The rate has not dropped. You still get 6% or 6.25%.

However, as the rate includes an introductory bonus until 1 May 2008. Therefore if you open the account now you won't get the bonus for a full year. AER is the rate you get if you put money into an account now and leave it for a full calendar year. Therefore the current AER assumes you get 6% or 6.25% until 1 May, and then 5.5% or 5.75% until September.

Rob is right, the AER on the website will change on the 1st of every month until the bonus runs out.

I think i know what your meaning, but up untill untill a few weeks ago whey still had 6% and 6.25% on there rates page even though this would have run out 5 months or so after the offer. Surly if they where going to change AER they would have been doing it every month from when the offer would last less than 12 months.

roddydogs

gibbyni wrote: »

I think i know what your meaning, but up untill untill a few weeks ago whey still had 6% and 6.25% on there rates page even though this would have run out 5 months or so after the offer. Surly if they where going to change AER they would have been doing it every month from when the offer would last less than 12 months.

Thats NOT what the girl told me! she said the rate HAD dropped! read the new website, you could get LESS than 6.08 if you calculate the whole year PBA -are you a spokesperson for Abbey? or is it just the way you read it?

gibbyni

roddydogs wrote: »

Thats NOT what the girl told me! she said the rate HAD dropped! read the new website, you could get LESS than 6.08 if you calculate the whole year PBA -are you a spokesperson for Abbey? or is it just the way you read it?

Im with you, i think they have dropped it, what im saying is for the people talking about the bonus, if they where taking that into account surly they would be changing they rate onthe site every month since they started the bonus. ie when there was 11 months left they put the rate down slightly, when thes was 10 months left the rate goes down slightly again etc etc. But they havnt it has just went from 6% to 5.8%

PBA

Yes I do work for Abbey, what I (and SalsaDanca) posted above is definitely correct. Unfort I can't get in to the news article about it at the moment, otherwise I could explain in more detail.

roddydogs

PBA wrote: »

Yes I do work for Abbey, what I (and SalsaDanca) posted above is definitely correct. Unfort I can't get in to the news article about it at the moment, otherwise I could explain in more detail.

So why dosent the website still say 6.25%, with the details saying "until 05/08 or whatever, like all the other ISA providers why are they doing themselves no favours anyone reading the website would think that there only getting 6.08%!