Val Padbury, of Clist Financial Management Ltd, said her client on Northern Rock’s ‘Together’ product had only been offered the option to move onto the lender’s SVR or a fixed rate at 8.99 per cent.
Having previously been on a deal at 5.99 per cent, the client faced an increase in repayments of £200 per month.
Padbury thought there must have been a mistake, yet was told by a Northern Rock employee that it was correct.
However, the employee told her ‘off the record’ that the staff believed it was unfair to borrowers and against ‘Treating Customers Fairly’, as all other Northern Rock borrowers were being offered alternatives to SVR.
Padbury said: “It smacks of taking advantage of clients who have no other options. My client is so bothered by the increase in payment and not being able to go to another lender that he has put his house on the market. This is a problem that is going to affect everyone with a ‘Together’ product.”
However, John Watson, operational director at Northern Rock said clients did not have to move the whole 125 per cent to another lender.
He said: “There are options that brokers can look at. What they can do is look at the whole of market to see if they can find something that is better. We’re trying to be fair and open with them.”
