Go Back   English Forum Switzerland > Help & tips > Finance/banking/taxation  
 
Thread Tools Display Modes
Prev Previous Post   Next Post Next
  #1  
Old 28.09.2020, 16:49
Newbie
 
Join Date: Jan 2020
Location: Devon
Posts: 6
Groaned at 0 Times in 0 Posts
Thanked 0 Times in 0 Posts
exHelvetica has no particular reputation at present
Early repayment of Libor Mortgage...

I had a 3M Libor mortgage, with interest was payable quarterly in arrears.

The interest rate (3M Libor + Margin) was reset on a quarterly basis in advance (i.e. set in the last days of September for the coming Oct-Dec quarter etc.)

So far so good.

I had always assumed that because I was not on a fixed-rate product, the term of my mortgage would not be fixed either…

Work took me back to the UK and I put my property on the market.

The sale took many months to negotiate and it wasn’t possible to anticipate exactly when the sale would go through. There were even doubts right up until to the eleventh hour whether it would, but it eventually it went through in August and I was presented with a rather salty bill from my bank who believed that they were entitled to compensation to the tune of 1,5% pa from mid-August until to 31/12…

I’m scratching my head here as unbeknown to me, it would appear that I was effectively borrowing in rolling 3-month calendar quarter terms and I was obliged to give at least 3 months’ notice for the end of the next calendar quarter if I wanted to get out of it.

i.e. if I knew that my buyer wanted to complete the purchase on 01/10, I could have given notice on 30/06 but if the buyer wanted to complete on 30/09, I would have had to have given notice on 31/03 (i.e. effectively a full 6 months in advance of the sale).

The bank was thus lining itself up to extract at least 1,5% pa for 3-6 months in compensation in all but the least likely of circumstances (i.e. where the completion of a sale transaction could be negotiated on a firm basis at least 3 months ahead AND timed to coincide with the calendar quarter end).

Just wondering if this is just how it is before I consider contacting the Ombudsman for its view?
Reply With Quote
 




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Mortgage with monthly repayment Phil_MCR Finance/banking/taxation 7 12.09.2019 13:24
Bank not passing negative 3M Libor to our mortgage jim1 Finance/banking/taxation 102 27.07.2016 16:35
Early Partial Repayment of a Fixed Mortgge Macer Finance/banking/taxation 8 18.02.2015 14:09
LIBOR mortgage - best spread Phil_MCR Finance/banking/taxation 17 23.01.2015 19:01
Repayment mortgage Alirezakarimi Housing in general 4 24.09.2009 17:57


All times are GMT +2. The time now is 20:39.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2021, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0