Bank interest rates increased since we agreed mortgage details

Shoves

We've gone sale agreed on a house and had submitted in writing what loan term, interest rate etc we wanted applied to the mortgage.

The bank have since lost the letter as well as other documents (which we have had to resubmit) that we hand delivered to one of their advisors. Their rates have now changed, so they're saying that the lower interest rate is no longer available.

Do we have any comeback? Or are they able to apply whatever rates are applicable at the time they are issuing the letter of loan offer?

Thanks!

roro2

It's the rate at time of drawdown that will apply, so it's not going to matter what's on the offer letter or your initial request.

themoneyguy

Sorry to say I agree with the above. I dont think there is any comeback here im afraid.

Shoves

Thanks for the replies lads

My sister had a similar thing happen about a few years ago, where they'd given her the option of a tracker interest rate when they applied but again they were going to drawdown the bank had stopped issuing trackers. Long story short she kicked up a fuss and got her tracker mortgage.

I'll check with her again as I may have some details wrong.

roro2

At a guess, I'd say that her offer letter quoted a tracker rate and, as they didn't envisage withdrawing tracker rates in advance, it didn't have a clause allowing them to completely change the rate structure before drawdown - i.e. change from tracker to Standard Variable Rate. It's unlikely that they simply gave her a tracker because that was the basis on which she initially applied if it wasn't quoted in her offer letter.

This is different to your case where it sounds like it's just the rate that has changed rather than the rate structure - and the T&Cs will permit this between offer letter issue and drawdown. Plus, it's just between time of application and offer letter in your case.