NRAM Together mortgage - why they are so unfair...

[IainHL]

CitzenB, for yours (and anyone else's) edification a Northern Rock Together Mortgage was comprised of 2 components:

• A secured mortgage up to 95% LTV, repayable on repayment or interest only terms, with a term up to 30 years (at least, I think it couldn't go beyond your 75th birthday);
  
• An unsecured loan up to 30% LTV, capped at a maximum of £30,000, repayable on repayment terms, co-terminus with the mortgage component, and at the same interest rate.
  

The specific problem being addressed here is that they used the same paperwork for all Together mortgages, showing the unsecured component as being regulated by CCA1974. This was so even for those borrowing in excess of £25,000, even though at the time the upper limit for CCA regulated loans was £25,000, which was not removed until April 2008, a date either after or near the end of the life of the product being offered.

 

It seems there are quite a lot of people in this position of having "unregulated" loans written on "regulated" paperwork, and NRAM (as they are now) have declined to offer us the same redress for their failue to comply with the statement requirements of the CCA2006 amendments as they have given to those with loans under the threshold.

 

Another problem that these Together mortages have is that if you de-couple the components (because of re-mortgaging for instance), the interest rate on the unsecured component jumps to 5% or 8% above SVR, thus dramatically increasing the repayments.

 

Also there are instances where, in the past, Northern Rock or NRAM have used the provisions of the CCA to take people in financial difficulties to court for non-payment of the unsecured component, including obtaining Charging Orders, despite the fact they are now saying they are not CCA regulated. This is why the OP is trying to contact the 2 people mentioned.

 

Finally in a post on 6th December 2008 pt2537 stated "the Northern Rock Together scheme is flawed, the agreement is not bolted together properly and as a result it is defective and irredeemably unenforceable". How I wish he was still around to elaborate further on that statement!

[citizenB]

Ah righto, yes I can see the problem now. Not sure I have any ideas at all.

[caro]

CitzenB, for yours (and anyone else's) edification a Northern Rock Together Mortgage was comprised of 2 components:

• A secured mortgage up to 95% LTV, repayable on repayment or interest only terms, with a term up to 30 years (at least, I think it couldn't go beyond your 75th birthday);
  
• An unsecured loan up to 30% LTV, capped at a maximum of £30,000, repayable on repayment terms, co-terminus with the mortgage component, and at the same interest rate.
  

The specific problem being addressed here is that they used the same paperwork for all Together mortgages, showing the unsecured component as being regulated by CCA1974. This was so even for those borrowing in excess of £25,000, even though at the time the upper limit for CCA regulated loans was £25,000, which was not removed until April 2008, a date either after or near the end of the life of the product being offered.

 

Seems odd that they'd use LTV if its unsecured too - not that I know anything about it.

[IainHL]

Yes a £30,000 loan over 25 years (300 months), interest rate initially 5.99% fixed for 5 years, then SVR, which at that point was 6.84%, really does mean you would be paying £31k in interest.

[citizenB]

Yes a £30,000 loan over 25 years (300 months), interest rate initially 5.99% fixed for 5 years, then SVR, which at that point was 6.84%, really does mean you would be paying £31k in interest.

 

Sheesh..!!