Nationwide reneging on Mortgage Charter

PixelPound

homesaver234 said:

You still haven't IDed a faulty premise.

Govt. says Nationwide has agreed; Nationwide says Govt. is wrong. and says Nationwide has not agreed (notwithstanding that Nationwide contradicts this on its website).

Whether the options are live is a separate issue.

Gov't says Nationwide agreed, Nationwide have updated their website to show the options. You say it's wrong because at one fixed point in time you phoned and was told that by an employee.

It's you that's on a faulty premise - that things cannot change, or the situation is about perspective.

PixelPound

MWT said:

Brie said:

badmemory said:

I would have to wonder what the benefit of interest only would be if by then the interest rates for any fix would be even higher.

It's simply a case of buying some breathing space to try to sort things out.  To get a new job, find things to sell, reassess one's budget. 

I'd still suggest looking at extending the term as a first option as that delivers a helpful reduction for as long as you need it, not just 6 months, and is something that you can fix in the future with overpayments for example, rather than taking the interest-only route which inevitably results in even higher repayments, unless you can repay the missing capital payment of course...

I suppose it depends on the age of the mortgage holder and the current agreement end date. Not sure many mortgage companies would be willing to extend beyond retirement age.

I also think there should be some form of financial assessment to stop going to interest only without understanding any knock on effects.

MWT

nic_c said:

I suppose it depends on the age of the mortgage holder and the current agreement end date. Not sure many mortgage companies would be willing to extend beyond retirement age.

Some lenders will go up to 80 years old for a believable occupation...

Not all for sure, but lenders are getting used to retirement ages moving out slowly and for many, there isn't much hope of being able to retire much before 70 anyway...

Brie

MWT said:

nic_c said:

I suppose it depends on the age of the mortgage holder and the current agreement end date. Not sure many mortgage companies would be willing to extend beyond retirement age.

Some lenders will go up to 80 years old for a believable occupation...

Not all for sure, but lenders are getting used to retirement ages moving out slowly and for many, there isn't much hope of being able to retire much before 70 anyway...

It does't need to be an occupation, it can also be a substantial pension.  I currently know of one individual 83 and another 92 that have interest only mortgages.  Both were taken out a few years back (so prior to current concerns) and seem to have been agreed on the basis that the banks will get the house when the individual dies unless any beneficiary can buy them out.

MWT

Brie said:

MWT said:

nic_c said:

I suppose it depends on the age of the mortgage holder and the current agreement end date. Not sure many mortgage companies would be willing to extend beyond retirement age.

Some lenders will go up to 80 years old for a believable occupation...

Not all for sure, but lenders are getting used to retirement ages moving out slowly and for many, there isn't much hope of being able to retire much before 70 anyway...

It does't need to be an occupation, it can also be a substantial pension.  I currently know of one individual 83 and another 92 that have interest only mortgages.  Both were taken out a few years back (so prior to current concerns) and seem to have been agreed on the basis that the banks will get the house when the individual dies unless any beneficiary can buy them out.

These are very different products though, Retirement Interest Only (RIO) mortgages have been around for some time, but will not be in use by the majority of people having problems over the next year or so...

Also need to keep in mind that for joint borrowers, the affordability is assessed individually so it has to be viable should either party die.

Brie

@MWT thanks but neither is classed as an RIO.  Just interest only.

MWT

Brie said:

@MWT thanks but neither is classed as an RIO.  Just interest only.

Brie said:

 Both were taken out a few years back (so prior to current concerns) and seem to have been agreed on the basis that the banks will get the house when the individual dies unless any beneficiary can buy them out.

I'm not aware of any mortgages other than the retirement products (.... or Equity Release) that allow for a term that runs until death... (... or entry into long term care typically)

It would be interesting to know the name of the product they have?

... but in the context of this thread, I guess it doesn't really matter as we are talking about options from the current lender for those already with a repayment mortgage...

homesaver234

No, I didn't say it is wrong. I said Nationwide said it is wrong.

As for "was told that by an employee." well yes of course, because employees are the only people who say anything for Nationwide, don't you know?

homesaver234

"One, as yet untrained phone centre employee, gave you faulty information"

What's the basis for your claims a) she was untrained and b) her info was faulty?

homesaver234

ACG said:

The building society have said they are not just going to allow people to switch to interest only without any questions. And depending on the answers to those questions they may refuse the request. 

Then they'll be in breach of their agreement to follow the Charter, which has:

A new agreement between lenders, the FCA and the government permitting customers to switch to an interest-only mortgage for six months ... if they choose to. Both options can be taken without a new affordability check

Ultimately the building society have basically said they have rules to follow with their governing body and those supersede this charter

That would mean they agreed the Charter in bad faith. Sounds very unlikely to me. They'd be slaughtered when they fail to abide.