Terminal Grant and Interest Only Mortgages
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Bizarre. I don't touch mortgages but I can put you in touch with a Sleaford graduate who does if it's of any help. An investment (Buy to Let) mortgage shouldn't require the same level of redemption awareness as a normal interest only arrangement. I spoke with someone the other week who has almost 350 houses to his name in Manchester, Leeds, Liverpool and Bradford; I'm pretty certain he isn't worth the 'x' million required to redeem that little debt.
Thread Starter
My 'well-known high-street' bank confirmed today that they will no longer accept the AFPS 75 Terminal Grant as a suitable 'repayment vehicle' for an interest only mortage. As of next month I am obliged to turn our interest-only element of the mortgage into repayment, but for the duration that the exisiting mortgage has to run - which is a substantial increase on our monthly mortgage outgoings, albeit at the exisitng interest rate. Other brokers have confirmed that other banks similarly will now not touch Terminal Grants, either.
So for those who have used their Terminal Grant as a form of collateral, expect to be contacted by your lender idc.
So for those who have used their Terminal Grant as a form of collateral, expect to be contacted by your lender idc.
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What does your contract say? Either way, just because the bank tells you what it is going to do, you simply say 'no'.
Tell them that you're making a complaint based on them not applying the principles of TCF (below), that their unreasonable and tardy volte-face will be excessively punitive on you and your family and that as a result, you stand to lose money and possibly your home if you have to default due to the higher monthly charges. I don't imagine they will change their mind - at that point you take it to the Financial Ombudsman Service (FOS).
Treating customers fairly - Financial Conduct Authority
I will help you draft a formal complaint in words that might work if you want a steer. The case is that the TG isn't part of the pension, and legal minds within FOS will pick up on that subtlety, in fact - its far less risky than the investments that those scumbags sold in order to cover the interest only portions of in house mortgages anyway! Also, lets face it, applying corporate pressure in order to pick up on relinquished assets isn't exactly unheard of right now..
PS: What bank is it? If it is a 'saved' one, are they saying that public money in the form of a Terminal Grant is no good, but public money that may bail them out, is?
Tell them that you're making a complaint based on them not applying the principles of TCF (below), that their unreasonable and tardy volte-face will be excessively punitive on you and your family and that as a result, you stand to lose money and possibly your home if you have to default due to the higher monthly charges. I don't imagine they will change their mind - at that point you take it to the Financial Ombudsman Service (FOS).
Treating customers fairly - Financial Conduct Authority
I will help you draft a formal complaint in words that might work if you want a steer. The case is that the TG isn't part of the pension, and legal minds within FOS will pick up on that subtlety, in fact - its far less risky than the investments that those scumbags sold in order to cover the interest only portions of in house mortgages anyway! Also, lets face it, applying corporate pressure in order to pick up on relinquished assets isn't exactly unheard of right now..
PS: What bank is it? If it is a 'saved' one, are they saying that public money in the form of a Terminal Grant is no good, but public money that may bail them out, is?
Last edited by Al R; 29th Nov 2013 at 17:41.
. I restate my opinions at posts 4, 14 and 16.
Thread Starter
For the record, Lloyds Bank no longer accept Terminal Grant as a 'payment vehicle' for interest only mortgages as they regard it a pension, and require retrospective action if you try to change your mortgage (eg further advance). I've really percevered with the company but a large complaint is inbound to them, and tempted to move all our accounts.
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Quite a few years ago, the RAF Benevolent Fund had an Insurance Advisory Service. It may be worth getting in touch with them if they still have that dept. They helped me out with an issue, it may work for you. Hope you get it successfully resolved.
Gene
Gene
Better idea is to contact a pathetic MP, sorry Sympathetic MP and get it raised at PM Qs and watch Banks being called to heel very very quickly.
Call Me Dave and Osborne love to give people a roasting...............
Call Me Dave and Osborne love to give people a roasting...............
Thread Starter
Things have moved on a bit. The Bank's medja team have been contacted outlining the embarrasment factor surrounding this - and a reply is awaited. Separately a note has gone to my MP...
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That was a palavah. Regretably, Forces Pension Society never got back to me - a little annoying as I'm a member too.
In the end the matter meandered and went up to the Head of Credit Services who, by the kind hand of fate, used to sit in the Chater Road/Lloyds Bank portacabin at Wittering 30 years ago, and so his understanding of the TG and AFPS certainly helped. He explained how these days, the bank would accept investments worth in excess of £1,000,000 etc as guarantees. But he did see though, that someone of Whenurhappy's (clearly) impeccable standing, and the financial means which are to hand to discharge his mortgage debt should be taken into account and so, Lloyds will honour the arrangement and take the Terminal Grant as an acceptable security in lieu of a more appropriate investment vehicle.
It won't do it in all cases though, and so there is probably a bit of a struggle to be had in future if you find yourself in a similar position. I think that it's a case of pushing on an open door and that the corporate resistance isn't too strong, so Lloyds will scrutineer, quite closely, the amounts promised, and other factors - such as length of service/rank/career etc will be looked at. I have contacted Whenurhappy, but am posting this so if anyone is in a similar boat, please get in touch. I won't post the e-mail address of the chap at Lloyds, but I am happy to pass it on if anyone is in a similar position. At least the precedent has now been set.
In the end the matter meandered and went up to the Head of Credit Services who, by the kind hand of fate, used to sit in the Chater Road/Lloyds Bank portacabin at Wittering 30 years ago, and so his understanding of the TG and AFPS certainly helped. He explained how these days, the bank would accept investments worth in excess of £1,000,000 etc as guarantees. But he did see though, that someone of Whenurhappy's (clearly) impeccable standing, and the financial means which are to hand to discharge his mortgage debt should be taken into account and so, Lloyds will honour the arrangement and take the Terminal Grant as an acceptable security in lieu of a more appropriate investment vehicle.
It won't do it in all cases though, and so there is probably a bit of a struggle to be had in future if you find yourself in a similar position. I think that it's a case of pushing on an open door and that the corporate resistance isn't too strong, so Lloyds will scrutineer, quite closely, the amounts promised, and other factors - such as length of service/rank/career etc will be looked at. I have contacted Whenurhappy, but am posting this so if anyone is in a similar boat, please get in touch. I won't post the e-mail address of the chap at Lloyds, but I am happy to pass it on if anyone is in a similar position. At least the precedent has now been set.
Good work Al. I would have thought that it would be in the service interest to advise financial institutions about the merits of gratuity payments? It must be a free bonus for recruitment and retention?
OAP
OAP
