Northern Rock End of Mortgaged Deal (Merged Threads)

juliesg

mpavfc wrote: »

I have had the same letter through today with my secured loan dropping the full 1.5% but my mortage only from 7.48% to 7.33%.

I have just called up the collections dept (the only dept open now) and apparently the full reduction on the mortgage rate will come into affect from the 1st Jan- still good, but not good enough. Why are some customers getting it straight away and others a week later?

I was advised to ring customer services tomorrow and ask that question- will do so.

all very confusing if u ask me mine dont end till aug so i findout then what is happening my rate at the mo is 5.99 so just above the svr but what happens next sept who knows

knighty76

My 2 year fixed rate ends 1st December, meaning that from that date I transfer to (just under) the SVR, I had a letter through saying that as my fixed rate ends, my rate will be 7.33% with effect from 1st December. I called them up and asked why I am going to 7.33% and not 5.83% in line with their new SVR, as I had read that their reduction is supposed to come into play on the 1st December as written here:

http://companyinfo.northernrock.co.uk/corporateCommunications/news/article.asp?newsID=209

They said that the new SVR will not come into effect until 1st Jan. I commented that this would seem to contradict the press statement on their own web page (above). The guy suggested that this was due to the time needed to administer the change, or some other nonsense.

This technicality is going to cost me around 140 quid, just in time for xmas thanks Norther Rock. If my discount rate ends on 1st December, and Northern Rocks' SVR reduces from 7.34 to 5.84% on the same day, how can I pay a monthly payment which includes a month's worth of interest at that higher rate?!

Hope this makes sense, and if anyone could clear up what my position should be I'd really appreciate it.

Thanks,
Rich.

kieran1979

For those not sure why the rate is only coming down to 7.33% in December - are you on Together mortgages by any chance?

Check the T's and C's of your agreement.

I think you'll find that one of the conditions of the Together mortgages says that any change in your mortgage rate gets passed on a full month after the change to the BOE rate. Hence why this month you're only getting the 0.15% cut which NR passed on from the previous months 0.5% BOE cut.

So the 1.5% gets passed on NEXT month. It sucks, but to be fair it is in the agreement, and if rates were going the other way there'd be no complaints.

MarkyMarkD

Most lenders change their rates at the start of the month following any BoE rate change. There are good reasons why they delay - not least the requirement to give notice to all borrowers paying by direct debit.

stephensdan

^ to be fair, if the rates are going down, they don't need to give much notice do they? no ones going to argue when they are makeing a saveing!

I'm a bit lost reading these last few posts though. The link above to the Rocks site shows that they are passing on the saving from December the 1st which makes sense...are some people being told otherwise?

Rjhsteel

So lets get this right. Northern Rock are lowing the SVR on the 1st Dec, but we, the customers, won't get the real benefit until the 1st Jan09? What a rip off!!!

So really they aren't changing the rate until Jan2009.

kieran1979

Rjhsteel - see my previous post.

The rate will come down from 1st Dec if you happen to have a NR tracker mortgage.

If however, you have a Together mortgage, one of the conditions is that rates are passed on another month later.

It's nothing to do with needing to give notice, or to do with Direct Debit changes. It's simply that it is a term of the mortgage agreement.

stephensdan

That clears it up for me Kieran, cheers.

Rjhsteel

So when the rates do go up again, they will go up 2 months later then?

stephensdan

It depends what type of mortage you have and what the conditions of that mortgage are. If you are unsure, just give the Rock a ring. The statement on their site is pretty self explantory though and you should know whether you are on a fixed, tracker or VBR mortgage and what that entails...