Do you have a case against Abbey National?

Q My wife and I took out a two-year fixed-rate mortgage from Abbey National just before Labour took office for their first term, knowing they would raise interest rates - which they duly did. The arrangement was that after the fixed period we would be tied to Abbey's standard variable rate (SVR) for four years. This tied period ends at the end of the current year and the SVR is currently 6.1%.

In the light of the Halifax ruling, do we have a case against Abbey? It is very difficult to find out what rate we should be on - we have tried ringing up as first time customers and asking for a loan , but they always say 6.1%. Is this correct?

JH

AThis is a tricky one. In March last year, Abbey National abolished its standard variable rate and introduced two new tracker rates for all further business. These were a "no frills" tracker rate, at 0.9% above the base rate, and a flexible tracker rate, at 1% above the base rate.

At the time, that made these rates 6.65% and 6.75%, respectively. New borrowers taking out fixed, capped or discounted loans would have to choose one of these two new rate types once the fixed period ended.

Subsequent reductions in the base rate have meant that these two rates are now at 4.9% and 5% - yet Abbey National's press office confirms that its current standard variable rate is 6.1%. This would certainly suggest that you are paying a higher SVR than any customers who have taken out standard variable rate mortgages since March 2001.

When it introduced the new rates, the bank did say that it would not automatically move customers' loans onto the new rates - they would have to write to the lender and ask for their loans to be moved. I'm assuming you didn't do this.

Nevertheless, you may well have a case. I suggest you write to Abbey National, outlining your complaint, using this letter format which is based on the Consumers' Association's version.