Transfer to First Direct 5.5% ISA

MrChips

Hello,

I am looking for some help on my cash ISA situation. My cash ISAs for the last few tax years are as follows:

2003/04 £3000 with IF, transferred to Abbey, transferred to First Direct (6.25% until October)
2004/05 £3000 with A&L (5.15%)
2005/06 £3000 with NCBS (5.15%)

I am happy with the interest rate on the two most recent tax years subscriptions. However I have twice transferred my oldest ISA when interest rates were disappointing.

By the time I transferred to First Direct a few months ago the ISA was worth about £3200. They would only allow a transfer of £3000 so I moved that across leaving £200 with Abbey.

Now Abbey's rate is even lower, I want to move the final £200 across into First Direct's new 5.5% ISA. However I am having trouble getting FD to accept the money. I have spoken to at least 3 people on their phone line who have all said something different.

The most recent one said that because I had already opened 2 ISAs this year (the second one with the transfer to FD, not new money) the IR wouldn't allow me to open another one. I said I didn't think this was true and that the only limit was on the maximum of £3000 new money paid in in any tax year, not on the number of transfers of old ISA allowances.

Who is right? Should FD have a problem with me opening another ISA and using it to transfer across the £200 from Abbey? My ultimate aim would be to also transfer across the £3000 from the other FD account when the rate drops in October (although reading the conditions, they may not allow this internal transfer so I might have to transfer it twice ;-) )

Milarky

MrChips,

If memory serves, First Direct are entitled to place restrictions on transfers-in during the six-month promotion.

You don't mention the "6.25%", so I assume you transfered-in (opening the FD ISA) at the current fixed rate of "5.50%"

If so, then I think you'd have to wait until the promotion ends and this particular restriction no longer applies

FD only offers one ISA, you see, but in different 'wrappers'. When 6.25% was offered to new customers (and later 5.50%) these rates were not available to existing accountholders. But after six months the rate drops and the accounts all merge. At that stage I imagine they will accept your £200 transfer from Abbey.

Best to phone up FD and check this through with them.

[NB Abbey £200 is not a subscription, it is interest. Thus arguments about 'what' year don't arise normally when seeking to transfer such amounts]

MrChips

Thanks for the quick reply.

My current First Direct ISA is at 6.25% (I opened it in April).

Does that mean the 5.5% offer isn't available to me as an existing accountholder?

If this is the case, maybe my best course of action would be to transfer my current FD ISA to my A&L ISA in October when the rate drops, and then open the new FD ISA once my original account is closed?

EcO_3

Hi there, I was planning to do the same thing as MrChips. Move out of the FD @ 6.25% in October and close the account. Then move back in the new FD @ 5.5%.
Had anyone tried to do that yet ?

kinesin_2

While not a current FD ISA owner, I've just switched my IF ISA over to Halifax.

I originally looked at the FD 5.5% isa, but it's only fixed till 15th Feb 2006 and limited to 10k transfer. Using the saving calculators it worked out that even using the maximum 10k transfer the gains from now till the 15th worked out at under £20.
I didn't think it was worth switching to FD just for £20, knowing I would have to switch again by the end of April.