Charter Savings Interest Rate Change - Advice Requested re. T&Cs and Potential Complaint

npb34

Dear all

Many thanks to everyone for taking the time to comment!

I must admit, I was expecting a variety of views, so the consensus against my taking further action is very striking and helpful.

As a professional writer, with legal training, I still confess I cannot see any way that Charter Saving's statement in their T&Cs ("The interest rate is fixed for two years from the date your initial deposit is creditd to your Fixed Rate Bond (the fixed rate period)") can mean anything other than that the interest rate is fixed, i.e. determined, from the date of the first deposit, and therefore is not fixed before that date, i.e. remains variable (down as well as up).

I agree with those who said I could have opened a second new account at the higher rate - I realised that at the time, but simply didn't think that was necessary in light of that statement in the conditions. I did try to confirm my understanding of the statement with Charter Savings, but twice waited so long on the 'phone that I gave up. In any case, I didn't think the T&Cs were ambiguous. I do accept the poster's comment above noting that those banks that do apply higher rates to newly opened accounts, should rates be raised in the period between account opening and first deposits, explicitly advertise this fact, which this bank does not do. I do feel that if even the bank's own employees misunderstand the T&Cs in this regard - as evidenced by my communications with them (the first CS staff I spoke to said they'd change the interest rate for me, and the secure message, quoted above, also indicates a misunderstanding) - then the T&Cs are not at all crystal clear.

In any case, as I'm clearly in a minority of one in this instance, I shall accept that the precise wording of the T&Cs alone is not a sufficient basis for my pursing this complaint, and shan't take this further with the bank or ombudsman.

This will cost me a couple of hundred pounds, but save me lots of time and stress, so I'm genuinely grateful to all those who responded.

Best

K.

OldMoneySaver

npb34 said:

As a professional writer, with legal training, I still confess I cannot see any way that Charter Saving's statement in their T&Cs ("The interest rate is fixed for two years from the date your initial deposit is creditd to your Fixed Rate Bond (the fixed rate period)") can mean anything other than that the interest rate is fixed, i.e. determined, from the date of the first deposit, and therefore is not fixed before that date, i.e. remains variable (down as well as up).

But surely a professional writer with legal training should recognise that you can't rely on such assumptions - saying that a rate is fixed after a date doesn't necessarily mean that it isn't fixed before that date.

Perhaps you're misinterpreting 'fixed', if you're equating it with 'determined' - in the above context it simply means that the rate won't change for two years from the specified date, not that it's actually set or decided on that date as such.

npb34

Thanks, OldMoneySaver! That's helpful. So the word 'fixed' functions as an adjective not a verb here. I really didn't read it like that.

Perhaps: "From the date the initial deposit is credited to your Fixed Rate Bond the interest rate stipulated at the date of opening the account will be applied for a term of two years, and during this period (the 'fixed rate period') the interest rate will not change."

masonic

npb34 said:

Perhaps: "From the date the initial deposit is credited to your Fixed Rate Bond the interest rate stipulated at the date of opening the account will be applied for a term of two years, and during this period (the 'fixed rate period') the interest rate will not change."

I think they'd take some heat from the Plain English Campaign if they wrote that. They are defining when the fixed rate period begins and ends. This is the period during which you can receive interest at the fixed interest rate. The rate itself is defined elsewhere in the agreement. T&Cs are written in such a manner to break down the contract into simple terms, each conveying a different element of the agreement. It is done this way so that each can stand on its own and be tested, without getting mixed up with other concepts.

"The interest rate is fixed for two years from the date your initial deposit is credited to your Fixed Rate Bond (the fixed rate period)" therefore means that the date your initial deposit is credited to your Fixed Rate Bond marks the beginning of the fixed rate period, and that two years thereafter the fixed rate period comes to an end. During the fixed rate period the rate is fixed (invariant).

OldMoneySaver

npb34 said:

Thanks, OldMoneySaver! That's helpful. So the word 'fixed' functions as an adjective not a verb here. I really didn't read it like that.

Exactly - you've articulated that distinction more concisely than I managed, so that's your professional training coming to the fore there!

Perhaps worth adding the context within which your quote was published, i.e.

Can Charter Savings Bank change the interest rate?

 

No. The interest rate is fixed for 2 years from the date your initial deposit is credited to your Fixed Rate Bond (the Fixed Rate Period).

which follows the section entitled "What is the interest rate?", with its single nominated figure - if the intention was to set a rate when initially depositing then that would need to be spelt out in this section....

npb34

Here's a crystal-clear statement from another bank.

• Can Investec change the interest rate?

  No, the interest rate is fixed for the term. The interest rate you receive will be the rate at the time you applied for your account.

OldMoneySaver

npb34 said:

Here's a crystal-clear statement from another bank.

• Can Investec change the interest rate?

  No, the interest rate is fixed for the term. The interest rate you receive will be the rate at the time you applied for your account.

Perhaps Charter could have said:

• Can Charter Savings Bank change the interest rate?

  No, the interest rate is fixed for the term, which starts on the date of your initial deposit. The interest rate you receive will be the rate at the time you applied for your account.

but (as I read it) that's not really a million miles from what they do say!

masonic

npb34 said:

Here's a crystal-clear statement from another bank.

• Can Investec change the interest rate?

  No, the interest rate is fixed for the term. The interest rate you receive will be the rate at the time you applied for your account.

The other bank has failed to mention what the term is or when it starts. I suspect the other bank has defined those things elsewhere, just as Charter defined the rate elsewhere. I actually think it is clearer to have a rate defined in the pre-contract information, rather than put the onus on the customer to remember what it was when they applied (and potentially have no way of proving what they saw).