Interest in fixed saving account changed few days after I opened it - can I ask for an adjustment? (

Alicon88

Hi

I would like to know your opinion.

I opened at the beginning of July this year a 1 year fixed rate saving account with Lloyds Bank in the UK. At that point, the interest rate was 5% (pretty decent).

Only a few weeks after, the interest rate has gone up to 5.5% with the same kind of account but obviously, mine has not changed.

While I do understand that these are called fixed for a reason, do you think there is any room for asking for an adjustment of my current interest rate with the one now available? Or will the answer be irrevocably NO?

What do you think? Am I just a delusional?

Thanks

wiseonesomeofthetime

I did the same with Tandem a few years back. They increased rate three DAYS after I locked in.

I asked the question, however, I got the anticipated NO.

I suspect every provider with whom there is no Cooling Off Period will give same response.

You take your chance and make a choice.

If Lloyds had reduced your bond to 4.5% would you have been happy if they'd imposed that rate on you, is the main consideration tbf.

jaypers

A pretty certain no. 

Reddleman79

I'm afraid it'll be a NO.
Judging the top of the market is always hit or miss, usually miss.

Alicon88

I would have imagined so.

It's pretty upsetting though, since it really has changed no longer than 10 days after I opened it

Alicon88

wiseonesomeofthetime said:

I did the same with Tandem a few years back. They increased rate three DAYS after I locked in.

I asked the question, however, I got the anticipated NO.

I suspect every provider with whom there is no Cooling Off Period will give same response.

You take your chance and make a choice.

If Lloyds had reduced your bond to 4.5% would you have been happy if they'd imposed that rate on you, is the main consideration tbf.

yes that's a fair point and I totally understand it.

It seems to me these kind of changes don't happen in 24 hours , so in your case more than mine it was quite obvious they knew it in advance and they didn't advertise it or give you a cooling off period on purpose.

I will take my chance tomorrow but my expectations are close to 0 of course 

retiringtoosoon

You can always ask….

if Ernie doesn’t give me £1m tomorrow I’ll ask for a recount

ForumUser7

Alicon88 said:

Hi

I would like to know your opinion.

I opened at the beginning of July this year a 1 year fixed rate saving account with Lloyds Bank in the UK. At that point, the interest rate was 5% (pretty decent).

Only a few weeks after, the interest rate has gone up to 5.5% with the same kind of account but obviously, mine has not changed.

While I do understand that these are called fixed for a reason, do you think there is any room for asking for an adjustment of my current interest rate with the one now available? Or will the answer be irrevocably NO?

What do you think? Am I just a delusional?

Thanks

OP, is this the existing customer ISA, or a bond?

To echo others, very unlikely they’ll increase the rate. But with the ISA you could transfer with a penalty if rates go up much higher in the future. At this stage, likely the cost of the 90 day penalty would be more than the gain from the new rate though, and I wouldn’t think this was a good move.

https://www.moneysavingexpert.com/savings/isa-switch-calc/

Edit, seems to be possible to close bond too with 90 day penalty, but would refer you to summary box for all options and to work out how to do this if you wanted to in the future. Also refer to your account specific documentation, in case Lloyds penalties change in the future.

Doctor_Who

Alicon88 said:

Hi

I would like to know your opinion.

I opened at the beginning of July this year a 1 year fixed rate saving account with Lloyds Bank in the UK. At that point, the interest rate was 5% (pretty decent).

Only a few weeks after, the interest rate has gone up to 5.5% with the same kind of account but obviously, mine has not changed.

While I do understand that these are called fixed for a reason, do you think there is any room for asking for an adjustment of my current interest rate with the one now available? Or will the answer be irrevocably NO?

What do you think? Am I just a delusional?

Thanks

There's a thread from a few days ago (below) that mentions a limited number of providers that allow early closure of fixed rate bonds for a fee, Lloyds is one of them:

https://forums.moneysavingexpert.com/discussion/6462873/fixed-rate-bonds-early-closure-transfer-options

Alicon88

ForumUser7 said:

Alicon88 said:

Hi

I would like to know your opinion.

I opened at the beginning of July this year a 1 year fixed rate saving account with Lloyds Bank in the UK. At that point, the interest rate was 5% (pretty decent).

Only a few weeks after, the interest rate has gone up to 5.5% with the same kind of account but obviously, mine has not changed.

While I do understand that these are called fixed for a reason, do you think there is any room for asking for an adjustment of my current interest rate with the one now available? Or will the answer be irrevocably NO?

What do you think? Am I just a delusional?

Thanks

OP, is this the existing customer ISA, or a bond?

To echo others, very unlikely they’ll increase the rate. But with the ISA you could transfer with a penalty if rates go up much higher in the future. At this stage, likely the cost of the 90 day penalty would be more than the gain from the new rate though, and I wouldn’t think this was a good move.


Edit, seems to be possible to close bond too with 90 day penalty, but would refer you to summary box for all options and to work out how to do this if you wanted to in the future. Also refer to your account specific documentation, in case Lloyds penalties change in the future.

the 90 days penalty meaning they will calculate 3 months on the interest on the amount of money I deposited and with the interest rate of 5% and will charge me with that?

sorry if it's stupid question, not really an expert about these matters

Doctor_Who

Alicon88 said:

ForumUser7 said:

Alicon88 said:

Hi

I would like to know your opinion.

I opened at the beginning of July this year a 1 year fixed rate saving account with Lloyds Bank in the UK. At that point, the interest rate was 5% (pretty decent).

Only a few weeks after, the interest rate has gone up to 5.5% with the same kind of account but obviously, mine has not changed.

While I do understand that these are called fixed for a reason, do you think there is any room for asking for an adjustment of my current interest rate with the one now available? Or will the answer be irrevocably NO?

What do you think? Am I just a delusional?

Thanks

OP, is this the existing customer ISA, or a bond?

To echo others, very unlikely they’ll increase the rate. But with the ISA you could transfer with a penalty if rates go up much higher in the future. At this stage, likely the cost of the 90 day penalty would be more than the gain from the new rate though, and I wouldn’t think this was a good move.


Edit, seems to be possible to close bond too with 90 day penalty, but would refer you to summary box for all options and to work out how to do this if you wanted to in the future. Also refer to your account specific documentation, in case Lloyds penalties change in the future.

the 90 days penalty meaning they will calculate 3 months on the interest on the amount of money I deposited and with the interest rate of 5% and will charge me with that?

sorry if it's stupid question, not really an expert about these matters

Yes, the penalty will be ~1/4 of the yearly interest you would earn. Hence, you need to decide if the new account pays enough extra interest to make it worthwhile to switch.

Edit: I see you've asked the same question in another thread and had the same answer. You can use the ISA calculator (you can use this for a non-ISA fixed rate bond) to see how switching to different accounts and paying the penalty might be better or worse for you.

https://www.moneysavingexpert.com/savings/isa-switch-calc/