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Fixed Rate Mortgage increase?
Posted: 07 Jan 2023 12:29
by kirby
We agreed a fixed rate mortgage in 2017 under a restructured mortgage but a month ago received notification that it is going up by another euro 100 or so a month. This will add another £20k or so overall to the mortgage.
Despite efforts to contact Alpha Bank, no one has come back to me on my query how a fixed rate mortgage can increase.
I today received another letter telling me it has gone up again.
Is anyone else in this situation please? I or can offer advice.
I have tried emailing, calling etc, messaging through online baking etc (I am in the UK), but I get no response or my calls get lost in the system.
Can Alpha Bank legally increase a Foxed rate Mortgage?
Any help or advice would be appreciated. Please do not tell me to contact Alpha Bank, I have tried every avenue and they won’t respond.
Thank you
Re: Fixed Rate Mortgage increase?
Posted: 08 Jan 2023 10:57
by Pantheman
How long was the term for the fixed rate? 5,10, 15 years?
Generally, they cannot change a fixed rate until the term finished. Are you sure you had a fixed rate and not a fixed term??
Only other thing I can think of is to check the details of the agreement, but that said, how can a rate be fixed but changeable??
Sounds like you need to keep calling, either that or miss a payment and let them call you!!!
Re: Fixed Rate Mortgage increase?
Posted: 08 Jan 2023 11:13
by kirby
Thank you Pantheman
Definitely a Fixed Rate for 25 years! (I will be 77 - or dead - when it is paid off, deep joy)
I was actually going to do what you suggest - miss a payment and wait for the angry ‘phone call from them!
I am so very frustrated with them and scared about this. I know I should get my lawyer involved but I just keep seem to be throwing money that I haven’t got at a problem that only gets bigger.
Re: Fixed Rate Mortgage increase?
Posted: 09 Jan 2023 07:09
by Pantheman
kirby wrote: 08 Jan 2023 11:13
Thank you Pantheman
Definitely a Fixed Rate for 25 years! (I will be 77 - or dead - when it is paid off, deep joy)
There must be some mistake, banks don't fix mortgage rates for 25 years that I am aware of, are you sure it is not your term you are looking at?
If in the event I am wrong and it is 25 years, then no they cannot change it.
Re: Fixed Rate Mortgage increase?
Posted: 09 Jan 2023 18:38
by Nigel Howarth
I came across an article in 'In Cyprus' that may throw some light on fixed rate loans:
"Banks do provide plans which in the first years have a fixed interest rate so the loan instalment does not change depending on the ECB policies or the bank provides the option for a longer loan repayment period which implies a smaller instalment."
Regards,
Re: Fixed Rate Mortgage increase?
Posted: 11 Jan 2023 09:00
by kirby
Thank you Nigel and Pantheman.
I have cut and pasted part of the agreement
“The said loan shall be repaid by the Borrower to the Bank on first demand. If no such demand is made the said loan will b e repaid bv 301 consecutive monthly instalments. The first instalment will be pavable o n
S 4 . 1 4 . . and each subsequent instalment shall be due and payable one month follcwingthe date on which the previousinstalment was due and payable until full and final settlement. Provided that if any of such
dates is not a business day, the relevant repayment date shall be the immediately succeedingday, which is a business day. The amount of the monthly instalments is set as follows:
for the first 300 instalments the instalment is set at CHF692,50 (SWISS FRANCS SIX HUNDRED NINETY TWO AND 50/100 ONLY)e a c h ,
The 3 0 1 instalment shall be of such an amount that will completely repay the balance of the loan
on its payment date including capital, interest and any expenses, rights and commissions of any nature for fulla n d final settlement.
Please proceed with the necessary arrangements so that the aforesaid amendment takes effect. “
So, I guess I ignore their letters, keep paying CHF692.50 and then hope the 301st payment isn't some great, big, hefty additional amount to pay.
Thanks for your help.
Re: Fixed Rate Mortgage increase?
Posted: 11 Jan 2023 09:26
by Pantheman
kirby wrote: 11 Jan 2023 09:00
Thank you Nigel and Pantheman.
I have cut and pasted part of the agreement
“The said loan shall be repaid by the Borrower to the Bank on first demand. If no such demand is made the said loan will b e repaid bv 301 consecutive monthly instalments. The first instalment will be pavable o n
S 4 . 1 4 . . and each subsequent instalment shall be due and payable one month follcwingthe date on which the previousinstalment was due and payable until full and final settlement. Provided that if any of such
dates is not a business day, the relevant repayment date shall be the immediately succeedingday, which is a business day. The amount of the monthly instalments is set as follows:
for the first 300 instalments the instalment is set at CHF692,50 (SWISS FRANCS SIX HUNDRED NINETY TWO AND 50/100 ONLY)e a c h ,
The 3 0 1 instalment shall be of such an amount that will completely repay the balance of the loan
on its payment date including capital, interest and any expenses, rights and commissions of any nature for fulla n d final settlement.
Please proceed with the necessary arrangements so that the aforesaid amendment takes effect. “
So, I guess I ignore their letters, keep paying CHF692.50 and then hope the 301st payment isn't some great, big, hefty additional amount to pay.
Thanks for your help.
This does not specify the interest rate. They put the amount you have to pay for the term as they have no way go know what the interest rate will be down the line. Somewhere it would or should specify any fixed rate for a given period, or if it is a variable rate they will state the Central bank rate plus their addition (it used to be the EURIBOR rate as they called it.
You need to check it again.
Re: Fixed Rate Mortgage increase?
Posted: 11 Jan 2023 17:06
by kirby
Thank you Pantheman for your help