justify ONLY reducing their SVR by about 0.1%, when the BoE has reduced the rate by 0.5% ?
Surely the government should make NR reduce by 0.5% - how can they expect the other banks to reduce rates when they won't make Nationalised Banks reduce them?

Historically, the Bank of England base rate has been reflective of the cost of borrowing between banks.

Now this is not the case. Even when the base rate gets cut, banks still lend to eachother at a higher rate because they are scared of defaults and need to cover their risks.

Your bank has to borrow money in order to lend it to you. Regardless of the base rate, if they can't borrow money at that rate, then they can't lend it on at that rate.

Sorry - it is totally rubbish, but it's how things are at the moment.

The government can't make non nationalised banks reduce their rates, it can only ask, and with nationalised ones like Northern Rock, if it asks them to take a loss on lending (which is essentially what you're asking them to do) then the tax payer must pay and I really can't see a 2% rise in income tax so that customers of NR can have mortgages at less than cost price winning any elections.

Mr Tom.

Thanks Mr Tom for the explanation, that does indeed clarify my understanding [ I was going to say "make sense", but I'm not sure it does!!!].

So I guess what we have to hope is that the BoE rates filter down into the Libor[?] rate, which will then possibly see changes to the SVR of the various banks etc.

I'm actually stuck between a rock [ no pun intended ] and a hard place, my fixed rate has run out with NR which means I'm now on the SVR, I can't remortgage as the change in house prices means that my LTV requirement is now about 95% - I've also in the last 18 months gone "self employed" by setting up my own business - which now means I can't find a mortgage co to touch me.

Oh dear.

This may sound a dumb question, but could you remortgage with Northern Rock? (Since you're already mortgaged with them)

Consider a tracker mortgage - that way at least you get something related to the base rate.

Best of luck.

Tom.

No it's not a dumb question - just a dumb answer - because of the "difficulties" Northern Rock have got themselves into they no longer offer mortgages to existing customers....

Oh dear.

This sounds like something to write to a newspaper about - maybe the FT. The point being that an entire book of business now can't remortgage, but they also can't move, so what options are open to them?

It's the sort of thing that the government need to respond to.

You could also email your MP as they really ought to be aware that this is bound to be a widespread situation.

I am also in the exact same situation with Northern Rock. My fixed rate ends in January and am currently trying to remortgage am hoping the surveyor can be generous by a bribe of tea and choclate Hob nobs..... but in reality I know i am probably looking at a 95% LTV also.

The mortgage quotes ive had so far are with 90% LTV and will only offer a fixed rate mortgage of around 6.79% which does still beat Northern Rocks Daylight robbery rate. So fingers crossed anyway, might have to go the Greggs and get the cakes in for the day of the surveyor arrives

actualy NR's has decreased their SVR by 0.15%, which is very generous.......not, especially when, so I hear, they've paid back almost half what they borrowed from HMGovt. You can't remortgage to NR if you're already with them, which is a bitter pill for many to swallow.

NR are also stitching up mortgage advisers who recommended clients use them over the past few years by trying to sell NR's own mortgage panel of 4 brokers (who are incidentally not independent).

Brian

On top of what Brian has said, Northern Rock have also had their hands slapped as the deals they're offering to new clients have been classed as 'too competitive'. According to EU legislation, any company receiving state aid are not allowed to be too competitive with privately owned lenders. Sounds shocking when you consider it's turning its nose up at existing customers and the mess that is causing!

Can i ask if any of you who have little equity are acutally on together mortgages (secured & unsecured loan)?

Michael

Michael - my friend is.

i told her to go to an ifa to find out what her options are - its not alot by the sounds of it :(

does it make a difference?

---

George

Hi George,

What quite a few brokers don't realise is that the unsecured element with Northern Rock, can infact be left with them at a higher rate. What your friend could potentially do is remortgage away (hopefully at 90% LTV) and whatever they cannot get on the new deal, can be left with Northern Rock. Think the rate is about 8% above the SVR, but it is a way of getting away from them. It's called loading, tell your friend to look into it with her broker.

Michael

We have a mortgage with NR which has run out and are now on the SVR. Trouble is our mortgage included £1000 help with costs that we have to replay if we change mortgage within 6months of the end of the previous rate. This is a pain in the neck but we're sticking with NR as we won't save £1000 in 6 months on a new rate. BUT they keep writing to us telling us about all the good deals they have secured for us with C&G, but they won't let us get out of the help with costs. I wish they'd pack up and go home and stop littering the planet with useless junk mail

Why don't all of you existing Northern Rock customers set up an action group & challenge them? Is their behaviour really treating customers fairly or are they disadvantaging you?

Several years ago Bank of Scotland offered "unscrupulous" mortgages called SAM- Shared Appreciation Mortgages, they withdrew them as soon as complaints started, however they've done very little to compensate those disadvantaged by these. Consequently, they have set up an action group & hopefully moving forward on this.......Why don't you people do the same.......starting by asking is it true and why did Adam Applegarth (chief executive) cash in £2.6m of shares near the stock's peak in August 2006 and January 2007???

http://www.safe-online.org/SAFE-HBOS-TALK-OVER-SAMS.html

It is very easy.

Set up a group on facebook and then write a petition on the number 10 website.

Post the links to the petition here and in the facebook group.

Then get people to email their MPs demanding that they sign the petition.

It's a nationalised organisation. It can't withstand the pressure for long if you see this through.

Also tell the FT or similar as this will add to the embarrassent and also get publicity for the group and the petition.

I have a Tracker for Life Mortgage with Northern Rock and I have been told that next week they will make a definate decision on what rate cuts they will pass on. They did suggest though that it's likely that only 0.15% discount will apply as they did on the SVR.

Surely a tracker mortgage should qualify for the full 0.5% ??

My other concern is if the base rate starts to go up again in the future, will Northern Rock then reduce the rate it goes up by or will they then pass on the full increase as set by the Bank Of England ?.

Something should be done about this surely ?

How should we complain about this so that it is looked into?