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BoS email included misleading marketing material on deals

From Peter Stokes

I feel I have to write to you about a communication I received from Bank of Scotland on January 15.

I was interested to read that the bank was launching two large loan tracker rates at 4.59% and 4.8%. I thought I would look at them in more detail as 0.66% and 0.45% below the base rate looked good.

To quote the email: “4.59% to 90% LTV, arrangement fee 2,499; 4.80% to 90% LTV, arrangement fee 1,199 – two-year large loan tracker rates with remortgage service.” Nowhere was there any mention of the margin below base rate.

Imagine my surprise when I looked at the rate guide on the website which stated that the rates were 0.41% and 0.2% below the base rate. You guessed it, it was using 5% as the base rate.

I thought I must have been confused about which base rate it was referring to so I looked more closely at the online guide and it was none other than BoS’ own base rate.

I thought maybe this had not changed yet so I checked. But BoS’ business website stated: “Bank of Scotland announces that with effect from January 11 2007 its base rate has been changed from 5% per annum to 5.25% per annum.”

So the bank is sending out marketing material that is incorrect by using its own outdated base rate to calculate an initial rate. It is difficult not to think that this was intentional as nowhere in the email is there any mention of the margin below base rate.

If true, in these times of treating customers fairly, how can BoS defend this sort of dishonesty? In the event of BoS trying to defend itself, I would like to ask it – would the email and product guide apply the same logic if its base rate had gone down? I think not.

Peter Stokes
Davidson Deem
By email


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