trapped in 2 year fixed 27months

AdamWhite

Hi All,


In summary, in November 2014 we bought a house with a 2year fixed rate deal with Santander. I have just rang them thinking it was time to renew our rate and have been told that the term ends on 3 February 2017 i.e. 27month.


Apparently despite applying for a 2year fixed they sometimes add months on to this as a cushion? (news to me and certainly of no benefit as the rate is quite high)


They have checked their system and apparently they did send us something in the post stating that the mortgage deal would have a fixed 27month period and 27payments of x. We must have overlooked this at the time. I suspect we would have seen 27 and read 24 as that's what the mind would expect on a 2 year fixed.


Santander aren't willing to let us end the term after 24months which will costs us some money. I feel like we have bought one product and been given another and there doesn't seem to be anything we can do about it. Clearly none of their mortgages are 27months long so this all feels rather disingenuous.


I'd appreciate it if anyone could make a suggestion of whether I should swallow this or try and do something about it... but what?


Thanks in advance
Adam

davidmcn

These are linked to larger deals which the lenders do, so they have specific end dates which don't relate exactly to when your mortgage completes. The product details I received the other day from Santander do say "circa 2 years" with the actual end date - your mortgage offer would have been similar, so I doubt you'd have grounds for complaint.

Thrugelmir

You choose a product which ends in February 2017. That's how lenders market their products and how their internal systems work. As lenders have a window in which to sell the product (i.e. the tranche of money allocated to a particular product before it is withdrawn).

If rates had now risen I doubt you would be complaining. Totally the reverse that it's in your favour.

To reduce the interest you are paying overpay the mortgage and reduce the debt owed.

butters_86

Common practice in today's market. As Thrugelmir stated that lenders have allocated a tranche of money to the particular product.

Did your mortgage advisor/broker not make you aware of the end date and did you not read the mortgage offer which would have clearly stated this. Think it's section 4 that details about monthly repayments and the product information.

haras_nosirrah

Nearly all lenders do this as an administration exercise. They allocate a certain amount of money to a product and everyone who gets that product ends at the same time in that case February. Your purchase must have gone through quite fast. Had it taken 6 months to go through you may have only got 22 months on the product

You didn't buy a 2 year fix, some lenders will do a fix that ends 2 years after you move, you bought a fixed rate until feb 2017 regardless of when it started. There is no complaint here as this info is on the key facts illustration and section 4 of the mortgage offer

amnblog

Lenders produce product with closure dates e.g. 31.01.2019 or closure term e.g. 2 years from completion.

If you look at Santander's rates today you will see the fixed rates run to date the trackers to term.

You didn't read your offer clearly.

You're miffed because by chance rates have come down not gone up since you fixed.

For once Santander have done nothing wrong.

ACG

Always read your paperwork! Your taking out a loan for tens or hundreads of thousands of pounds.

It would have been on the KFI (quote) and the mortgage offer. You can not really blame Santander for this. A 2 year fixed rate is 2 years give or take with a lot of lenders. I have just plugged some figures in to our sourcing system and you can see from the results, it is not uncommon:



Take a look at the last column, the tie in period is the number of months.

frazell

I have to say that I am somewhat sympathetic with AdamWhite as I'm in exactly the same situation with Santander.

I took out a 2-year fixed mortgage with them in Oct 2014 and I have the KFI quote that states the end of the product as the 2/10/16.

I called Santander end of last month to discuss retention products only to be told about this 3month "buffer". So annoyingly between my quote and my offer Santander changed the term to 27months.

Hands up I didn't notice, but I feel its a bit naughty to quote 24months and then offer 27months, I'm sure it would pass quite a few people by.

Anyway, just a few more months to wait and I can sort it all out.

Richey_

If you are staying with Santander won't they let you remortgage early? When our fix was coming to an end they offered us a good offer 4-5 months early to refix and stay with them. It was around 1% cheaper that LLoyds group were offering. May be worth a phone call.

fewcloudy

frazell wrote: »

I have to say that I am somewhat sympathetic with AdamWhite as I'm in exactly the same situation with Santander.

I took out a 2-year fixed mortgage with them in Oct 2014 and I have the KFI quote that states the end of the product as the 2/10/16.

I called Santander end of last month to discuss retention products only to be told about this 3month "buffer". So annoyingly between my quote and my offer Santander changed the term to 27months.

Hands up I didn't notice, but I feel its a bit naughty to quote 24months and then offer 27months, I'm sure it would pass quite a few people by.

Anyway, just a few more months to wait and I can sort it all out.

That would seem to contradict what some of the mortgage brokers on this thread have stated.


fc

kingstreet

I can't comment on individual cases, but from our point of view, before we ask a client to commit to anything we provide an illustration which clearly shows the end date of the product.

Once an application has been submitted, another illustration is issued with the mortgage offer.

Finally, post-submission, we issue another copy of the illustration with our suitability letter which states the end date of the product.

None of our clients ever got a rate ending on (eg) 01/02/2017 expecting a rate for two years from completion. If they asked for such a product, they would be given the best option of the type and asked if they preferred it over the recommended product which had the fixed end date.

You may well have found the rate for a two years from completion product was higher, so you'd have been paying more for the last two years...

Questions - did you buy with advice, or select your own product? Did you see an illustration? Did you receive your mortgage offer?