Tracker mortgages and base rate - a rant!

housebuyer143

Banks!! 
The BOE base rate goes down, and they reduce savings rates within a few days. Base rate goes up and they increase my mortgage rate the literal next day, but rate goes down and they are not reducing my rate until 8th December 😡 
In August when it went down, they made us wait 24 days, but 31 days is a bit rich. They don't recalculate the payments either, so this is when the new rate is applied to the account.

I'm tracking down the T&C to see what it says about this, but it's very poor form in my opinion. 

dunstonh

I'm tracking down the T&C to see what it says about this, but it's very poor form in my opinion. 

You appear to be assuming that that there is a direct link between the two where that isn't really the case much of the time.

Gilt yields and swap rates have a much greater influence on mortgage rates but not on savings.

vacheron

I noticed that Barclays used to send me a text message so quickly after an announced rate rise that I was often the first person in the ofiice to find out! 

However, today they were just as quick off the line with the cut. Mine changes on the first of the following month, but this was exactly the same as when the rates were increasing, so fair's fair.

housebuyer143

vacheron said:

I noticed that Barclays used to send me a text message so quickly after an announced rate rise that I was often the first person in the ofiice to find out! 

However, today they were just as quick off the line with the cut. Mine changes on the first of the following month, but this was exactly the same as when the rates were increasing, so fair's fair.

That seems completely fair and I don't think I would complain about that. YBS just seem to be picking a date out of the air and that's what feels unfair. 
The sceptic in me feels like they are reducing it on the 8th so no one can change thier DDs until January 🤔

housebuyer143

dunstonh said:

I'm tracking down the T&C to see what it says about this, but it's very poor form in my opinion. 

You appear to be assuming that that there is a direct link between the two where that isn't really the case much of the time.

Gilt yields and swap rats have a much greater influence on mortgage rates but not on savings.

My mortgage is linked to the base rate so it should have a direct link. 
I just find it bad that they are essentially catching out their customers because they charge them the higher rate from the day after it changes, but then make the same customers wait over a month when the rate goes down.

surreysaver

Mine changes contractually from the day after the payment date following the rate change, either up or down

CricketLady

I feel and share your pain, housebuyer143, and regularly have this rant to my husband - our tracker mortgage is with Barclays and if the base rate is cut, as this month, our rate changes from the 1st of the following month.

However, when the base rate increases, it's instant, I've known it change on the same day even though the text TELLS me it'll apply from the first of the next month (we are base rate +0.75%)

Sending you virtual sympathy!

Albermarle

Although the mortgage rate situation you describe does seem unfair, the position on savings is less clear cut.

The BOE base rate goes down, and they reduce savings rates within a few days.

Savings providers are driven also by their immediate need to raise funds ( or not) . In this case some will not pass on a small rate cut like 0.25%, as they do not want to lose any savings funds. Others might cut more. Providers will even sometimes cut or increase rates, even when there has been no change in the BoE rate.

Beddie

I have a base rate tracker mortgage with Barclays (was originally Woolwich branded but still Barclays) and it always goes up or down from the 1st of the following month, after a base rate change.

That's what it states in my original mortgage paperwork and on subsequent statements. So no, I'm not being treated differently whether rates go up or down.

housebuyer143

Just found this! What do you think it means by "the 15th of the month following the month during which a boe base rate change is announced"??

Why isn't anything written clearly 😑

@Albermarle @vacheron

eskbanker

housebuyer143 said:

Just found this! What do you think it means by "the 15th of the month following the month during which a boe base rate change is announced"??

Why isn't anything written clearly 😑

@Albermarle @vacheron

Not sure I'm understanding the difficulty - if (as is the case) the base rate is changed in November, the tracker rate will be changed no later than 15 December.