Is It A Fact That All ISA transfers have interest backdated ?

bristolleedsfan

Ian_W wrote: »

BLF - Is it all savings accounts OR all savings accounts with clearing banks?

"apply to all banks and building societies that are signatories of the UK's [URL="javascript:self.name='main';PopUp('you_popup','/pages/jargon/index.html?in_jargon_term=Banking Code','350','150')"]Banking Code[/URL]."

"UK banks and building societies will have to pay interest on money paid in by cheque after two working days"

http://www.thisismoney.co.uk/saving-and-banking/article.html?in_article_id=426832&in_page_id=7


back to isa transfer in interest

this is what i asked Scottish BS, followed by Scottish BS reply, im awaiting leeks reply to see if they will be paying interest from day of receipt, not had KRBS confirmation of account opening yet, when i do ill ask them same question. Clearly nationwide were speaking on behalf of all isa transfer in providers.

"nationwide bournemouth wrote to me on 29th november informing me that

1000 has been transferred to scottish Building Society" Why have you
opened account from 6th december ?

Nationwide member service northampton under signatory of peter hood
executive assistant wrote to me on 30th november, within letter of 30th november mr hood informed
me

" i know you were concerned about the loss of interest while cheques were
being posted from us to the new accounts, however i would like to assure you
that in ISA transfers the interest is backdated to ensure no loss is
incurred"

as the passbook you requested doesnt appear to have been updated by
nationwide i have no record of when nationwide transferred the iSAs out
above quote from 29th Nov states " has been " and leek opened account on
29th november. can u please confirm the date u are paying interest from
bearing in mind nationwides executive assistants assurance on 30 november
2007

"would like to assure you that in ISA transfers the interest is backdated
to ensure no loss is incurred"

thanks for your help "


reply from Scottish BS :beer:

"I refer to your recent email and would advise that we have adjusted the interest on the above numbered account by £1.12 to reflect the missing days interest.
I trust you will find everything to be in order. " :T

Milarky

To be honest, Mr Darling has got bigger fish to fry that fixing up ISA savers like us. But I suppose one could condense all this wisdom into a standard letter (Hosted by this site?) to accompany an ISA transfer request

- special instructions on the date when the transfer-out is to be effected?
- directions to transferees pointing out what is 'best practice' from the Treasury position?
- [slight misdirection?] by referring to the legal technicality on 'single dates'?

As BLF has found out, the more dogged and persistent you are in digging any single answer out of them, the quicker they throw you a bone to make you go away

[I transferred from Halifax to YBS in October and the date ends '12th' on the first account and begins '22nd' on the latter. So YBS don't or can't go back any sooner than they received their cheque, notwithstanding longer clearing times. However because Halifax failed to follow a separate 'additional instruction', to take out a small amount to round the closure balance - basically a lot of arsing about from their point of view - and simply sent a cheque for the full amount, they made 'a mistake' and offered me £25 - which just covered the nil interest period above.]

bristolleedsfan

the reason y nationwide northampton gave the assurance re no loss of interest on isa transfers out was because i asked them to transact and post the transfer out cheques on a monday to minimise loss of interest, nationwide effectively said doesnt matter what day a isa transfer out is transacted because all isa cheques are backdated to ensure no loss of interest is incurred on isa transfers.

masonic

If Nationwide believes that all banks backdate interest in ISAs to the date written on the transfer cheque, then it is clearly misguided. I've done a few transfers and I've never seen interest backdated in the way Nationwide describes. It usually seems to be backdated to the date the cheque was delivered, but even that doesn't seem to be a rule and I've had at least one instance where I'm sure no backdating at all could have taken place. It appears others seem to have had the same experience I have.

So, if there is some rule about the customer not losing any interest during a transfer it seems to be almost universally ignored. That makes what Nationwide says pretty worthless, unless they can provide you with some regulation you can use to fight it out with your new ISA manager. You could also try getting Nationwide to reimburse any lost interest, I suppose .

bristolleedsfan

masonic wrote: »

So, if there is some rule about the customer not losing any interest during a transfer it seems to be almost universally ignored. That makes what Nationwide says pretty worthless, unless they can provide you with some regulation you can use to fight it out with your new ISA manager. You could also try getting Nationwide to reimburse any lost interest, I suppose .

abbey say same thing as well. so most the isa providers have actually been, i dont like using this word "stealing"

http://www.abbey.com/csgs/Satellite?c=GSInformacion&cid=1157694140393&pagename=Abbey%2FGSInformacion%2FGS_ResumenHipotecas

"Step 2:
Your existing ISA provider will be contacted on your behalf and the money requested from your account. The interest will be backdated to the day the money leaves your existing provider to ensure no loss of interest. "

Article Here :cool:

http://www.guardian.co.uk/money/2007/nov/25/businessandmedia2

Isa transfer reward bust my annual subscription

"opened your account on 7 April, but the money didn't arrive from the Halifax until 14 June. Halifax closed your account on 7 June and NatWest has backdated the interest to then. "

This Is What Halifax Say :T

http://www.halifax.co.uk/isas/transferringyourisa.asp

"You won't lose any interest for the period your money is in transit because the funds are shown as credited to your account from the day after they left your existing provider"


i believe and i hope u all agree that i should be nominated for post of the month. :dance: :dance: :dance: :xmassign: :dance: :dance: :dance:


here is leek response ( just awaiting KRBS confirmation of funds receipt)

leek day of receipt was day after nationwide transacted it appears

"Further to your recent query I confirm interest has been paid on your investment from the date of receipt 29th November.

If you have any further queries, please do not hesitate to contact me.

Rachel Gilligan
Team Leader
Savings Department
ABC "

masonic

So, to summarise, you've found two ISA managers who will fully backdate interest in ISA transfers so that none is lost (Abbey, by policy, and Natwest, in one example). You've also found that with Halifax you lose 1 day of interest. So these providers seem to be amongst the best in terms of minimising lost interest.

However, with Leek, it appears they have only started paying you interest from the day they received the ISA cheque, which, luckily for you, was the day after Nationwide posted it.

Since you have now determined that "interest has been paid on your investment from the date of receipt", then you know what you were told by Nationwide was clearly incorrect in your case and your concern about minimising the interest lost was entirely justified.

So it looks like people are going to have to remain cautious about potential interest loss when transferring between ISAs.

Mikeyorks

Which takes you back to my post#2 ?

But I think it's a tactical arrangement rather than prescriptive. I've looked a while ago - but a quick glance again at the HMRC guidance reveals a lot about 'best practise' in transfers - and clear rules about co-inciding the transfer dates (for reporting purposes) .... but nothing whatsoever about the money orientated date. It seems a bit 'buyer beware ' as this appears to be the only related aspect under transfers :-

Quote:
The terms of a transfer should be agreed between the investor and both ISA managers

Milarky

The terms of a transfer should be agreed between the investor and both ISA managers

This means in practice that they can make any rules they please as long as they remain within the clearing cycle (of interest payable within two days of receipt of the cheque) and the customer has no 'general rights' as any transferee must 'agree' to accept you and so they say on what terms they shall.

The best bet therefore appears to be to stipulate with the current ISA manager that you will be indemnified in the event of the postage taking any longer than ususal (1 day) against subsequent loss of interest. Sign this note and then rely on their staff not reading it, or understanding its implications, that by proceding to send a cheque (made up with interest to last day) they may be asked for more later. Say something like; "Under the regulations governing the terms of transfer you are required to agree with me [semantics, it means 'we shall agree'] terms for an acceptable ISA transfer. The acceptance of this transfer request by you will be deemed to indemnify me against any loss of interest resulting from delays in the delivery of the cheque you send to the other ISA manager by the method of delivery you have chosen [1st class postage]

If they refuse to transfer I would be very much surprised. But you'd then have your fallback. The accepting manager can't of course be made to do any more.

bristolleedsfan

masonic wrote: »

So, to summarise, you've found two ISA managers who will fully backdate interest in ISA transfers so that none is lost (Abbey, by policy, and Natwest, in one example). You've also found that with Halifax you lose 1 day of interest. So these providers seem to be amongst the best in terms of minimising lost interest.

However, with Leek, it appears they have only started paying you interest from the day they received the ISA cheque, which, luckily for you, was the day after Nationwide posted it.

Since you have now determined that "interest has been paid on your investment from the date of receipt", then you know what you were told by Nationwide was clearly incorrect in your case and your concern about minimising the interest lost was entirely justified.

So it looks like people are going to have to remain cautious about potential interest loss when transferring between ISAs.

leek paid interest from day of receipt despite it being a cheque receipt ( so no waiting the usual in leeks case 2 calender days. ( 2 calender days being better than 2 working days elsewhere )

"Cheque Processing

Cheques paid in, other than Society cheques, will earn

interest after two calendar days."

http://www.leekunited.co.uk/assets/_documents/StatementofPractice-Investors1December.pdf

if nationwide pay interest on isa transfers out until day of transfer out transaction and new provider pays interest from following day then their is no loss of interest. ( Scottish BS also backdated interest to same day as leek once they were tackled about it)

nationwide didnt merely say if someone transfers an isa to them then their would be no loss of interest, the assurance they gave was re ISA transfers out. ( clearly this is in the spirit of account transfers where no loss of interest would be incurred on account balance transfers and in the spirit of the isa catmark because loss of interest on isa transfers is effectively a backdoor "charge" and lays providers open to a suspicion that they could transact transfer outs on a thursday or friday on purpose in order to keep the interest longer ( in this case nationwide transacted on a tuesday by post which in this case under the old cheque interest paying rules ( non isa) earliest interest would be paid by new provider would be the following monday) if all isa providers who accept transfers in behave the same way then its relatively revenue neutral )

as off today im still awaiting KRBS confirmatiion of receipt of remaining isa transfer out balance funds, i will tackle them about the issue when such confirmation has been received.

guess its for others to decide whether to tackle their new isa providers regarding any apparent loss of issue on what is effectively an account transfer. ( i.e the funds have always remained within an isa account)

bristolleedsfan

bristolleedsfan wrote: »

leek paid interest from day of receipt despite it being a cheque receipt ( so no waiting the usual in leeks case 2 calender days. ( 2 calender days being better than 2 working days elsewhere )

"Cheque Processing
Cheques paid in, other than Society cheques, will earn

interest after two calendar days."

http://www.leekunited.co.uk/assets/_documents/StatementofPractice-Investors1December.pdf

if nationwide pay interest on isa transfers out until day of transfer out transaction and new provider pays interest from following day then their is no loss of interest. ( Scottish BS also backdated interest to same day as leek once they were tackled about it)

nationwide didnt merely say if someone transfers an isa to them then their would be no loss of interest, the assurance they gave was re ISA transfers out. ( clearly this is in the spirit of account transfers where no loss of interest would be incurred on account balance transfers and in the spirit of the isa catmark because loss of interest on isa transfers is effectively a backdoor "charge" and lays providers open to a suspicion that they could transact transfer outs on a thursday or friday on purpose in order to keep the interest longer ( in this case nationwide transacted on a tuesday by post which in this case under the old cheque interest paying rules ( non isa) earliest interest would be paid by new provider would be the following monday) if all isa providers who accept transfers in behave the same way then its relatively revenue neutral )

as off today im still awaiting KRBS confirmatiion of receipt of remaining isa transfer out balance funds, i will tackle them about the issue when such confirmation has been received.

guess its for others to decide whether to tackle their new isa providers regarding any apparent loss of issue on what is effectively an account transfer. ( i.e the funds have always remained within an isa account)

quoting milarky "The terms of a transfer should be agreed between the investor and both ISA managers "

impression nationwide have given is that isa managers that accept ISA transfers in have agreed between themselves that no loss of interest will be incurred on isa transfers, if that is the case which is probable ( as nationwide will know they would be quoted on their assurance given) then some isa providers are clearly not implementing any apparent agreement that isa providers have regarding this.