Beware transferring ISA to Nationwide

Cannygirl_2

If you are wanting to buy the attractively-priced Nationwide Fixed Rate ISA Bond at 6.15% and you are transferring the funds from another bank/building society, be very careful. I tried to do this today and was told by Nationwide that,despite all ads on their site and sites like this, the rate of 6.15 % is NOT guaranteed. Their get-out clause is that it takes two months to transfer the funds between banks and so the rate may have gone down by then. If that were the case, you will have locked your money away for 1 or 2 years at a lower rate than they advertise.This is not made clear in the advertising and everyone I spoke to at the Nationwide was quite unrepentant about that. In the days of falling interest rates, I won't be gambling on the rate staying this high by investing with them, but I wonder how many other people have spotted this dodgy practice.

red_bertie

I think you can transfer again if they do this? [ISA gurus will confirm or deny]TBH a lot of people will be moving on if they try and pull a fast one - and they'll incur a lot of admin for beggar all.

RB

Cannygirl_2

I'm afraid there's an "early access charge" for closures and you can't make partial withdrawals. So not only do you have a serious risk of a lower rate than you signed up for but you pay for the privilege of leaving it if they drop the rate.

Speculator

see this thread...

http://forums.moneysavingexpert.com/showthread.html?t=845731

bristolleedsfan

Cannygirl wrote: »

If you are wanting to buy the attractively-priced Nationwide Fixed Rate ISA Bond at 6.15% and you are transferring the funds from another bank/building society, be very careful. I tried to do this today and was told by Nationwide that,despite all ads on their site and sites like this, the rate of 6.15 % is NOT guaranteed. Their get-out clause is that it takes two months to transfer the funds between banks and so the rate may have gone down by then. If that were the case, you will have locked your money away for 1 or 2 years at a lower rate than they advertise.This is not made clear in the advertising and everyone I spoke to at the Nationwide was quite unrepentant about that. In the days of falling interest rates, I won't be gambling on the rate staying this high by investing with them, but I wonder how many other people have spotted this dodgy practice.

There is a thread here on it, as has been pointed out it says quite clearly that the rate on transfers in will be the rate in force at the time that the funds are received.

http://forums.moneysavingexpert.com/showthread.html?t=845731

When rates were rising people were happy to receive the higher rate if a higher rate was in force when the transfer funds were received by Nationwide.

6.15% rate has been in force since early July 2007 so people have had plenty of time to transfer into it.

U could try transferring into Bradford and Bingley or Skiptons one year fixed rate ISA. ( then again they dont allow transfers in at all do they :rolleyes: )

Nationwide state the position quite clearly IMO :rolleyes:

http://www.nationwide.co.uk/pdf/savings/P115_ISAs.pdf

You can transfer cash ISA funds from another provider to any of our cash ISAs. However, please bear in mind that if you opt for our Fixed Rate ISA Bond its rate may have changed by the time we receive the funds.


Nothing "dodgy" about it, Halifax say same thing

http://www.halifax.co.uk/isas/transferringyourisa.asp

[FONT=Arial, Helvetica]Transferring to a fixed rate ISA[/FONT]
[FONT=Arial, Helvetica]If you ask to transfer to our fixed rate ISA, interest rates may change before the transfer has been completed.[/FONT]

bristolleedsfan

red_bertie wrote: »

I think you can transfer again if they do this? [ISA gurus will confirm or deny]RB

Belief people have in the "ISA sub forum" is that in that event people would have the option to transfer elsewhere penalty free for 60 days.

The rate has been 6.15% for so long now nobody appears to have experience of Nationwide reducing the rate while a transfer in is in progress.

farringtonb

the nationwide rate is when the application is received so the 6.15% would be guaranteed

bristolleedsfan

farringtonb wrote: »

the nationwide rate is when the application is received so the 6.15% would be guaranteed

http://www.nationwide.co.uk/pdf/savings/P115_ISAs.pdf

You can transfer cash ISA funds from another provider to any of our cash ISAs. However, please bear in mind that if you opt for our Fixed Rate ISA Bond its rate may have changed by the time we receive the funds.

Bonbon

Just thought you all might be interested to know, that while I was in Nationwide a couple of days ago, I was told by customer service that the interest rates on all savings will be going down on 1st May. If anyone is considering getting the 6.15% fixed rate ISA bond I suggest you do it ASAP.I applied for mine on 6th April and received it today. the actual bond was dated 9th so I 'm not sure if you get the rate on the day you apply or from when they process it.

Baldur

bristolleedsfan wrote: »

Belief people have in the "ISA sub forum" is that in that event people would have the option to transfer elsewhere penalty free for 60 days.

Paragraph 14 on Page 6 of the Ts & Cs suggests that those people's belief is erroneous - see http://www.nationwide.co.uk/pdf/savings/P115_ISAs.pdf
(my bold):

"14. Subject to early access charges on Fixed Rate ISA Bonds, if after opening the account, you do not consider it to be suitable, you may transfer the balance to another account with the Society, or have the money returned, provided that in either case the Society receives notification of your intention within 30 days from the date that the ISA was opened. The interest will be paid gross to you and the subscription will not count towards your ISA limits for that tax year. You can open a subsequent Cash ISA with the Society or another financial institution, up to your allowance for that tax year. The Terms and Conditions applicable to the new account will take effect from the date of the original investment."

While paragraphs 25 & 26 say:

"25 Unless your account has a fixed rate of interest, we may vary interest rates. We will only vary the rate for one or more of the following reasons:
(a) to reflect general market conditions or changes in general interest rates, including the interest rates or terms on which similar accounts are offered by other providers of financial services
(b) to reflect any changes or anticipated changes in the law, regulations or codes of practice or to respond to a decision by a court, ombudsman or regulator
(c) to respond to changes in the rates applying to our mortgage business
(d) to reflect changes to our costs, including administrative costs, costs involved in providing services or facilities or changes in the costs to us of borrowing funds
(e) to maintain our financial strength for the benefit of all our members.
26. If we vary the rate for one of these reasons, we will tell you about it by putting a notice in our branches and/or on our website or an advertisement in the press. If we vary the rate for any other reason we will notify you personally at least 30 days in advance and ignore any notice period on your account for at least 60 days starting on the date of the notice to allow you to close or switch the account without loss of interest."

As reason (a) above would probably be cited as the reason, the reference to ignoring any notice period for at least 60 days looks like a forlorn hope.

bristolleedsfan

Bonbon wrote: »

Just thought you all might be interested to know, that while I was in Nationwide a couple of days ago, I was told by customer service that the interest rates on all savings will be going down on 1st May. If anyone is considering getting the 6.15% fixed rate ISA bond I suggest you do it ASAP.I applied for mine on 6th April and received it today. the actual bond was dated 9th so I 'm not sure if you get the rate on the day you apply or from when they process it.

While there is a possibility that the 6.15% rate could be reduced around 1 May. the last time that Nationwide reduced its variable rate accounts on 1 March it left the 6.15 ISA fixed rates unchanged.

Your ISA fix should have got backdated to when u applied for it, what is the date of maturity? ( when does the fixed rate end)