2 months into a 3 year fixed rate, rates have significantly dropped and lender won't budge

NicLou2020

Hi Everyone,
I just wondered if anyone can provide me with advice please?
My initial 2 year fixed mortgage rate of 2.02% with Halifax was due to end 31st March 2020. I received all of the usual reminders and decided to be well prepared and fixed in a new deal on 2.89% for 3 years towards the end of January. I was disappointed that my rate was going up but felt it was better than going onto the SVR from 1st April.
From 4th May Halifax have significantly dropped their rates on fixed deals to around 1.64% due to the BofE base rate drop. I only realised this last week when I checked my mortgage statement and happened to see the new available rates... I called up the Halifax to see if they would re-asses my mortgage (as I am only 2 months in) as I feel extremely distressed about the whole situation.
My query was managed as a complaint and the very next day a lady from the complaints team called me back. We went through everything and I explained how distressed I am to be locked into a significantly higher rate for 3 years when the rates have dropped so much. i do 'all' of my banking with Halifax and stuck with them for my Mortgage as I like to have everything in one place. She said that she understands how I feel but that she cannot do anything about my fixed rate as I am out of my 'cooling off' period. Apparently I was sent a letter 2nd March to tell me about my 28 day cooling off period - however, I have no record of this.
Her conclusion to me is that I would have to pay £3200 to exit my agreement and get placed on a lower fixed rate. I said that I am not happy with the inflexibility given that all of my banking is done with the Halifax and that it has left a very bitter taste in my mouth.
She has written to me to explain that I am a valued customer and that she is sorry that she couldn't do anything for me to help.
Is there anything I can do or was this simply just a case of 'bad timimng' on my behalf?

[Deleted User]

Would you pay more if rates went up?

[Deleted User]

It's just a case of you having the product you chose.

It would have been unfair if rates had gone up and they had asked you increase your payments to reflect the new higher rate that you didn't agree to. 

You can be confident that you now have fixed payments for the next 3 years, regardless of what rates do.

tizerbelle

How would you feel if 2 months into a 3 year fixed deal, Halifax asked if they could increase the rate you were paying because BoE rates had gone up?

You took out a fixed term rate to manage your outgoings and protect yourself from fluctuations in the interest rate.  Sometimes this works in your favour (rates go up) and sometimes it doesnt (rates go down), either way you have a contract in place and the terms of that dont change just because you feel disappointed, dismayed or distressed.

RelievedSheff

Why exactly did you think that they were going to let you change to the lower rate?

You signed up for a three year FIXED rate deal. You knew what that meant when you took it out surely?

Stenwold

Echoing the other two posters - that's the nature of a fixed rate product; you're protected from any rate rises during the fixed period, but you won't benefit from any rate reductions.

Harvic

I'm afraid this is the gamble with a fix, you'd be laughing if interest rates had jumped up 2%.
There is a positive, however, if you looked to remortgage now they may have offered a lower valuation due to COVID-19. That might have put you into a worse LTV band or even negative equity, with higher rates or even stuck you on SVR. Try and see the positive of the stability you have now. Things will not be plain sailing over the next 36 months and nobody truly knows what this will mean for house prices and interest rates.

NicLou2020

Mickey666 said:

So, two months in, rates have dropped and you're moaning already.  Supposing Halifax gave in, lowered your rate and then rates dropped again in another few months?  What then, more moaning?  Maybe you should have chosen a variable rate mortgage?

Surely you understand that the whole point of a fixed rate is so you can know for sure what your repayments will be regardless of what happens in the markets?  In which case, you should still be able to afford the repayments.  Basically, you're insulated from the markets.  Who knows what the rates will be in two years time?  Perhaps they will be higher than you're paying now and you'll be happy again.  You really can't have it both ways.

Thank you for taking the time to respond. I appreciate your feedback (albeit a little patronising and rude). I am asking because this is the first time I have been in this situation and wanted to double check that I wasn't being naive or missing something. I am actually annoyed at myself for being so 'unusually' organised and missing better rates by literally 6 weeks. So not 'moaning' but wondering if I could do anything to change things. Many thanks again

NicLou2020

Harvic said:

I'm afraid this is the gamble with a fix, you'd be laughing if interest rates had jumped up 2%.
There is a positive, however, if you looked to remortgage now they may have offered a lower valuation due to COVID-19. That might have put you into a worse LTV band or even negative equity, with higher rates or even stuck you on SVR. Try and see the positive of the stability you have now. Things will not be plain sailing over the next 36 months and nobody truly knows what this will mean for house prices and interest rates.

Thank you for your response - that is really helpful and gives me a different perspective. 

blue_max_3

Halifax gives you Xtra. About 0.38% extra!
See if paying the £3200 fee still works out better. If you have a larger mortgage, it may still be worth it. But otherwise, it isn't much at all really. You can overpay to mitigate it too.

Edi81

Oh and loyalty doesn't mean anything with banks. In fact, they love people who bank exclusively with them as they can offer rubbish deals and people still stay.