It would appear there is trouble a-brewing between landlords who have a buy to let mortgage with the West Bromwich Building Society. We were contacted by a gentleman a couple of days ago when I agreed to put a little something here on the website. Since then I’ve had quite a number of emails (including from members) all expressing the same concerns and containing the same links. (If these emails have been orchestrated jointly, normally that would irritate us immensely but on this occasion they have certainly done the trick in making us get on with this article so as to clear a number of tickets in one run!)
The problem in hand is to ask the question: was it your understanding that interest rates on lifetime tracker mortgages or reversion tracker rates can only vary when the base rate moves?
There are now plenty of angry borrowers out there, 6,700 clients of the West Bromwich Building Society and a further 12,200 clients of Bank of Ireland are already affected. These lenders have decided to increase their profit margin by increasing the interest rates regardless of the fact that the Bank of England base rate has not changed. They are relying on ambiguous small print in their contracts, which is in conflict with their promotional materials and offer letters.
It appears a strong possibility that other lenders may follow suit and many now feel that this unethical practice should be stopped before other lenders make their decisions.
Michelle is a customer of West Bromwich and says:
I have a Buy to Let Mortgage with West Bromwich Building society that I took out in 2007. The mortgage is meant to follow a tracker rate at 2.49% above the bank of England base rate. or at least that’s what I signed up for.
West Bromwich recently wrote to me explaining that they would be raising the tracker rate an extra 2% as of December 2013. They specified that the reason for this was a very loose clause in the booklet that they sent me after I took out the mortgage.
I believe that I am being treated unfairly, along with hundreds of other West Bromwich customers. We have grouped together and are doing everything we can to raise awareness, including contacting Watchdog, our local MP’s, complaining to the financial services ombudsman and joining a class action lawsuit with The Law Department.
There does appear to be momentum behind this class action, which people affected can register their interest with on the property118 forum.