OakNorth - I was mislead ?!

Bucki

Hello All


Maybe I was silly or mislead but the OakNorth interest rate of 1.6% for 6month is not true.
The last year's website shown 1.6% for 6 month as a table which I literally thought it would be getting the 1.6% for the £18750 amount over 6 month period which would be £300 but guess what ... ??


The 1.6% is based on annual interest rate.
Great ... this means, would actually get only 0.8% half of the £300


Also my money is now locked until ebd of April 2020 duhh!!



What a £$%^& is this.
Was it just me or anybody else fell into this "trap" ??


:mad:

[Deleted User]

I think just you.

BoGoF

Deleted_User wrote: »

I think just you.

Agreed.

I think the 'AER' on the website table of rates would be a giveaway.

eskbanker

Bucki wrote: »

Maybe I was silly

75% of these words apply....

Reaper

If it was 1.6% for a 5 year term would you expect to get back just 1.6% at the end of 5 years, or 1.6% every year?

If the latter then you must already understand its the annual rate that is being quoted which means the total return will depend on the length of time it is invested.

Prepare to be equally surprised if you ever take out a regular saver.

Neil_Jones

Bucki wrote: »

Hello All


Maybe I was silly or mislead but the OakNorth interest rate of 1.6% for 6month is not true.
The last year's website shown 1.6% for 6 month as a table which I literally thought it would be getting the 1.6% for the £18750 amount over 6 month period which would be £300 but guess what ... ??


The 1.6% is based on annual interest rate.
Great ... this means, would actually get only 0.8% half of the £300


Also my money is now locked until ebd of April 2020 duhh!!



What a £$%^& is this.
Was it just me or anybody else fell into this "trap" ??


:mad:

Well I thought it would have been obvious that the quoted rate was per year because that's what AER stands for... "annual equivalent rate"

So logically it follows that if you sign up for six months you only get six months worth of interest, surely? Why would you think otherwise?

No "misleading", just your good self not reading it properly.
Oakwood used to have a slider on their website that allowed you to put an amount of money in and how long the fix was and it would tell you how much you would have got back after six/nine/twelve/whatever months at the equivalent rates, but they have sadly removed this.

Bucki

How silly of me!
Of course the AER would be the give away ... and yes, it was me the silly one.


Guess the overwhelming "thought of interest" deleted my rational thinking and made the mistake.
I guess the £18750 would have been better used elsewhere but heey-hooo.


Lesson learned damn.

bowlhead99

Bucki wrote: »

How silly of me!
Of course the AER would be the give away ... and yes, it was me the silly one.


Guess the overwhelming "thought of interest" deleted my rational thinking and made the mistake.
I guess the £18750 would have been better used elsewhere but heey-hooo.


Lesson learned damn.

If they paid you 1.6% per year on the £18750, for the 6 months that you had it with them, that's not too bad. You'll struggle to find anyone paying more than 1.6% per year on £18750 for six months these days. So perhaps it wouldn't have been better used elsewhere.

MaxiRobriguez

Agreed. If the money was always going to be in capital protected schemes then you're not really any worse off despite your mistake.

But do read the terms more closely next time.

Bucki

MaxiRobriguez wrote: »

Agreed. If the money was always going to be in capital protected schemes then you're not really any worse off despite your mistake.

But do read the terms more closely next time.

Agree, nothing to lose I guess.
One thing I could have done is:


- open another Santander 123 current account (already have one in joint name)
- and have access to the money at any point at time if needed without being penalised.
- surely had to cover the 1500 monthly income and 2 DD's (down site) but yeh ...

Anyway, only 3 more months to go :P i shall be fine.

bowlhead99

Bucki wrote: »

Agree, nothing to lose I guess.
One thing I could have done is:


- open another Santander 123 current account (already have one in joint name)
- and have access to the money at any point at time if needed without being penalised.
- surely had to cover the 1500 monthly income and 2 DD's (down site) but yeh ...

Anyway, only 3 more months to go :P i shall be fine.

Yes, if you had not wanted the 1.6% you could have instead received 1.5% at Santander, though you would have needed to pay them £5 a month for the privilege as well as jump through the various hoops you mentioned (cycling money in and out of the account to meet the minimum monthly deposit amount and to fund the mandatory direct debits)

It sounds better to get a higher interest rate, than to get a lower interest rate and pay £30 of fees (£5 a month) while being required to get involved in a lot of extra account admin to meet the qualifying conditions.

The 'advantage' of having instant access is not so great when it causes you to get a lower interest rate, pay an admin fee, jump through various qualification hoops, and you don't need the access anyway (as you say, you'll be fine for the remaining three months)...