Mortgages – rate change information

On Thursday 2 November 2017 the Bank of England increased the Base Rate of Interest by 0.25%. This means the Base Rate is now 0.50%.

As a result, the interest rate that applies to all of our Tracker mortgages and loans linked to the Bank of England Base Rate will also increase by 0.25% in line with the Terms and Conditions of these accounts.

In November 2017 the Landmark board agreed to increase our Standard Variable Rate (SVR) by 0.15% from 4.64% to 4.79%. This change will take effect from 1st January 2018.

If you are a customer who is affected by an interest rate change, we will write to you in December 2017 before any change to the interest rate or monthly payment is applied to your account. This letter will confirm both the date when the new interest rate will apply and the specific impact on your monthly payments. You do not need to take any action now – the letter we send you will let you know if you need to do anything.

The impact of the interest rate change on your monthly payments will depend on a number of factors, such as the type of mortgage you have, the current balance and remaining term. We cover some of these factors in the Q&A section below.

Customer Questions & Answers

Why has my interest rate and monthly payment changed?

Following the Bank of England’s most recent decision to increase its Base Rate of Interest, the interest rate that applies to all of our tracker mortgages and loans linked to the Bank of England Base Rate will also increase in line with the Terms & Conditions of these accounts. This will affect your monthly payments.

For Standard Variable Rate accounts (SVR) that are not linked to the Bank of England Base Rate, Landmark has reviewed the impact this has had on our SVR and as a result, we will be increasing our SVR by 0.15% to 4.79%. This will affect your monthly payments.

What is my new interest rate and monthly payment?

You will find all this information in the letter that will be sent to you. It is an important document so please keep it in a safe place.

When will my interest rate and monthly payment change?

Your payment will change with effect from the date in the letter that will be sent to you. Monthly payments you make after this date will, therefore, need to be for the new amount.

Why might my new monthly payment be different to what I expected?

There are a number of important factors that can affect your new monthly payment when an interest
rate change occurs, so this may differ from your own calculations. Unless you have recently asked us
to recalculate your monthly payment, differences can arise for a number of reasons, for example where
you have;

  • made regular overpayments to your account;
  • incurred any additional fees and charges;
  • taken a payment holiday;
  • not paid ground rent/service charges and we have paid these on your behalf;
  • made reduced monthly payments for any reason;
  • missed any monthly payments for any reason.

The impact of these differences on your monthly payment may be exaggerated if you only have a short outstanding term remaining on your mortgage or loan.

You may also find that the impact of this rate change on your monthly payment is different to the change that occurred after a previous interest rate change.

Do I need to do anything?

It is important that you make your new monthly payment in full and on time to prevent your account falling into arrears, as this could adversely affect your credit file and could also mean you incur additional fees and charges.

If your payment is made by online transfer, cheque, branch or phone, please make a note of your new monthly payment and pay this amount from the next payment due date after your rate changes (i.e. after the date specified in the letter that will be sent to you).

If you pay by Standing Order and need to contact your bank or building society to change your monthly payment amount, remember to give up to 4 working days’ notice for this change to be made. If your monthly payment has increased and you do not change your Standing Order amount, you will fall into arrears.

If you pay by Direct Debit your monthly payment will change automatically. We will collect the new monthly payment amount from the date specified in the letter that will be sent to you, so you do not need to take any further action.

If you currently pay by another method but would prefer the convenience and security of paying by Direct Debit, please call us on the number shown on your letter.

What if I am struggling to afford my monthly payments?

If you are worried about making your monthly mortgage payments, you should call us immediately using the number on the letter that will be sent to you. The sooner you speak to us, the more we can usually do to help. We will always consider your personal circumstances and be fair and considerate at all times. You can also visit the Personal Support section of our website at www.landmarkmortgages.com/personal-support

Alternatively, the following organisations offer free support and advice and are on hand to help you keep your finances on track. They provide impartial information on what to do if you are experiencing (or anticipate) financial problems or issues.

The Money Advice Service provide free and impartial money advice to help improve your finances, visit www.moneyadviceservice.org.uk or call 0800 138 7777.

Citizens Advice offer free, confidential and impartial advice on legal, money and other problems. For online information or to find your local office, visit www.citizensadvice.org.uk for England and Wales and www.cas.org.uk for Scotland.

National Debtline is the helpline that provides free, confidential and independent advice on how to deal with debt problems. If you have concerns about your debt call free on 0808 808 4000 or visit www.nationaldebtline.co.uk

StepChange is the UK’s leading debt charity. They can help you manage your debts and better understand your money. Their debt advice is based on over 20 years’ experience and their service is free and completely confidential. If you think you may benefit from their help, call them to speak to a qualified debt adviser on 0800 138 1111 or visit www.stepchange.org

What if my account is already in arrears and I am behind with my payments?

This depends on the method you use to make your payments and whether you are currently repaying your arrears with an additional amount each month as part of an agreed payment arrangement.

If you do not pay by Direct Debit, you need to arrange to change the amount you pay (see Question 5).

If you are unsure what to do, or think you may struggle to meet either your regular monthly payment or the additional arrangement amount, then please contact us immediately so we can try to help you. We will always take your particular circumstances into account and treat you with fairness.

What if I’ve previously made overpayments?

Every overpayment reduces your outstanding balance but does not alter your remaining term. Therefore, your new monthly payment has been calculated by applying the new interest rate to a lower balance over your remaining mortgage term.

Your letter that will be sent to you explains the impact of the rate change on your total monthly payment. If you are comfortable with this amount, you do not need to contact us. However, if you now wish to change the amount of your overpayment, please contact us using the number on the letter that will be sent to you.

What if I’m in the process of making changes to my mortgage?

There are a number of changes you can potentially make to your mortgage that are unaffected by this rate change, such as ‘Power of Attorney’ and ‘Consent to Let’. If you are making such changes, you do not need to take any action as a result of this letter.

However, if you are redeeming (closing) your account, you should ensure that you make the monthly payments quoted in the letter that will be sent to you until your account with us is actually repaid. Similarly, if you have recently requested a redemption statement, you should bear in mind that any figures quoted may now need to be recalculated following the interest rate change.

Also, if you have received a recent Change of Parties or Porting offer, we will provide a revised mortgage illustration.

If you are unsure about anything here, please contact us using the details on the letter that will be sent to you.

What should I do if some or all of my payment is funded by the Department for Work and Pensions (DWP)?

If you claim Income Support, Pension Credit, income-related Employment and Support Allowance or income-based Jobseeker’s Allowance, the DWP will normally pay at least some of the interest on your mortgage, as long as you took the mortgage out to buy your home.

Support for Mortgage Interest (SMI) is paid at a standard rate set by the government, and is not based on the interest rate that you actually have to pay. You remain responsible for paying the difference between any DWP contribution and your total monthly payment and should make any necessary changes to your payment.

For more information about SMI, including the current SMI rate, visit www.gov.uk/support-for-mortgage-interest

If you are worried about affording your mortgage each month, please call us as soon as possible using the number on the letter that will be sent to you.

Where can I get more information?
Please visit our website at www.landmarkmortgages.com for a range of useful information about interest rate changes, including a number of helpful tools. Alternatively, if you would like to speak to someone about your mortgage, please call us using the number on the letter that will be sent to you.