Paying a mortgage using two direct debits.

Sol19a

Hello,
I have a joint mortgage with my partner, we pay the same amount each monthly . We have always had separate bank accounts, probably because we were middle aged and our finances were kind of "settled" before we became a couple. We decided to not bother with a joint-account (we like it this way). 
The lender will not allow us to have two direct debits - the only reason given is that "the system does not work that way". As a result one of us setup a DD to pay half and the other set up a Standing Order to pay the other half. It has all been going smoothly and there have never been any missed payments. Then for some reason and without warning - the bank doubled the DD to cover the full amount . I asked them to explain why - but they have not given any reason . After spending an hour with their team on the phone - they accepted the arrangement was agreed at the start of the mortgage and will now reinstate the arrangement. 
I am puzzled why they will not allow two DD's but they flatly refuse. They have agreed to refund the overpayment (but this is not relevant as we overpay annually in any case).
The details of the Mortgage are not relevant but it is 50-50 (Repayment and Interest Only - with 10% overpayments allowed on both or distributed to one or the other).
Is it "uncommon" for couples without joint accounts to not have dual direct debits for their joint mortgage ??

amnblog

It is almost unheard of

alleycat`

Why wouldn't you just have the standing order go to the person with the DD and have it set up like that?

I understand the financial independence aspect of it but you could both manage the account so it's not like you'd not be aware if they stopped paying?

Sol19a

The only reason must be that it is perhaps seen as "riskier" for the bank ? But not sure why ?

Newbie_John

Why don't you create a joint account just for mortgage? Set up standing orders in your private account to pay "half" to the joint and have direct debit from there? You'll keep all your money in your private accounts.

Or one of you becomes the main payer paying full amount, and the other sends them their "half" each month as standing order. 

DullGreyGuy

Sol19a said:

I am puzzled why they will not allow two DD's but they flatly refuse. They have agreed to refund the overpayment (but this is not relevant as we overpay annually in any case).
The details of the Mortgage are not relevant but it is 50-50 (Repayment and Interest Only - with 10% overpayments allowed on both or distributed to one or the other).
Is it "uncommon" for couples without joint accounts to not have dual direct debits for their joint mortgage ??

Most likely its never had enough demand from customers to warrant the IT development to allow it to happen. In big companies there is finite IT resource and different products/teams bid for a slice of the pie with a business case. I'd struggle to see that they get enough enquiries to say there is a staff saving or enough of marketing bonus to say they'd win extra customers if they had this feature. Its not only got to save/generate more money than it costs but the rate of return has got to be better than the new counter fraud tool the chap in Credit Card's wants to implement (or what ever other changes are being proposed in the bank)

There are obvious ways around it:

1) Both pay SO and therefore the bank cannot change it 
2) One pays by SO into the other's account and that one pays in full by DD
3) Open a joint account just for the mortgage and each SO into it and it DD's to the mortgage
4) Continue as is

I would say the majority of people do 2 or 3 

fewcloudy

Newbie_John said:

Why don't you create a joint account just for mortgage? Set up standing orders in your private account to pay "half" to the joint and have direct debit from there? You'll keep all your money in your private accounts.

Or one of you becomes the main payer paying full amount, and the other sends them their "half" each month as standing order. 

100% of all the readers of this thread thought exactly the same thing as you and me within 1 millisecond of reading the first post.

So there must be a reason why OP would not just do that, but I cannot think of it. Oh, previously bankrupt and unable to open a new bank account maybe?

Sol19a

Thanks, we will continue as is. I can understand there may be an "IT overhead" for the bank that probably deters them from offering the two direct debits option. I suppose if two are allowed, then eventually someone will ask for three and so on !
So I guess this is a general rule for any bank or service provider - they do not offer more than one direct debit for any form of customer billing ?

Sol19a

fewcloudy said:

Newbie_John said:

Why don't you create a joint account just for mortgage? Set up standing orders in your private account to pay "half" to the joint and have direct debit from there? You'll keep all your money in your private accounts.

Or one of you becomes the main payer paying full amount, and the other sends them their "half" each month as standing order. 

100% of all the readers of this thread thought exactly the same thing as you and me within 1 millisecond of reading the first post.

So there must be a reason why OP would not just do that, but I cannot think of it. Oh, previously bankrupt and unable to open a new bank account maybe?

Thanks, no that is not the reason. We just could not be bothered ! (to open another account). We trust each other to pay the SO or DD. But I simply could not understand (but perhaps now can see the reason) why they the bank could not allow the 2 DD's (in the first place).
The bank did not object to the original arrangement of SO and DD - so I was puzzled as to why they decided to cancel the agreement without warning or any default. 

DullGreyGuy

Sol19a said:

Thanks, we will continue as is. I can understand there may be an "IT overhead" for the bank that probably deters them from offering the two direct debits option. I suppose if two are allowed, then eventually someone will ask for three and so on !
So I guess this is a general rule for any bank or service provider - they do not offer more than one direct debit for any form of customer billing ?

Are you really going to pay a higher interest rate so you can get two DDs rather than having two SOs, SOing into one persons account and then DDing or setting a joint account?

Different providers will have different IT systems, some may have the ability to support more than 1 DD but its not going to be attracting sufficient customers for them to be shouting about it -v- lower rates, parental support, offsetting or whatever other feature they feel makes their product special and worth applying for

Newbie_John

If you trust each other with money then one of you can open in their name with some of the new banks without leaving house in couple of clicks - like Chase / Kroo / Starling. This is no longer the case you need to go to a bank in person, sign papers, wait weeks - some of these new banks literally take minutes to open - all from home.
The middle one pays interest rate of 4% on your balance so you could get few £ each month, not sure which one is the easiest as some of these banks don't offer joint accounts but there's no reason why it could be in one person name.

Anyway, your problem could be solved in many other ways but banks see it as useless feature because not many would use it. And it's actually quite complicated - do they allow 2 direct debits or unlimited? Each direct debit costs them money, so if someone sets up 100? What happens if 99/100 go through but 1 doesn't? Missed payment?