For Halifax Tracker Customers

minimike2

Hi Guys,

Right, very unexpectedly this margin clause that we have discussed a little over the past couple of months has become an issue, sooner than expected.

To claify, the exact wording of the caluse is as follows:


"We can also change the tracker margin to your disadvantage, but only at a time when the tracker base rate is less than 3% a year".

I think the KEY part of this phrase is "LESS THAN".

I will re-post on this thread once I have received my letter from the Halifax advising me of what my new rate is, however if it is not the full 1.5% reduction I will be challenging, as the rate is not less than 3%, it IS 3%.

I would be grateful if other Halifax tracker customers can post on here what happens with thier rates too. Lets not slaughter them before we know what they are going to do, but just be wary of this in case thier decisions do not go as we would expect them to.

sammyjammy

Well it makes my rate now 3.14 Mike, I read it as you d othat this should be passed on in full, I'm just watching Working Lunch and their opinion is that this rate is what they would have done over the next few months but they've done it all now for impact purposes, so fingers crossed it won't go any lower, I will be mortified if I end up on a tracker of +1.14 or more rather than my current 0.14%

minimike2

Indeed....my thoughts exactly. The clause gives them licnese to alter the margin if base drops below 3%, meaning a further drop in rates could see the likes of you and me actually paying MORE. Ive only got 7 months left on mine, but it could have a bigger effect on people with longer to go. I guess the only savings grace is that the government own part of HBoS now, so can put pressure on them.....we shall see!

djm1972

Might be worth obtaining clarification on the reversion.

Once the rate has been changed to your disadvantage; can that be "for good", or once the base rate goes above 3% will the differential revert the previous amount?

minimike2

Very good point and an important one, as that is an even worse scenario...

It goes on to say

"If we make a change to your disadvantage and the tracker base rate subsequently increases to 3% or more a year, the changed margin will continue to apply unless and until we change the tracker margin again".

This is very bad news, as it means they have no obligation to revert it back to what you originally had. There is also no mention of any maximum amount that they can change the margin by - I am seeking further clarification on this from Halifax.

mark101saint

Hi all

this is my first post

Great to see the bank of england cut the base rate by 1.5%

But im on a tracker mogage which is 0.010 % below the base rate which make my rate now 2.99 %

so where do i stand now will it be capped at 3%

and what happens when the rate goes up again will i still be 0.010 below the base rate need help was never town about this clause when i got the mortgage a year ago.

mark

minimike2

Hi Mark,

Welcome to the boards.

To clarify the situation - The collar as we understand it, only kicks in one the base rate drops BELOW 3%, regardless of what your own margin is.

I am currently waiting on answers to the following three questions from Hafliax and will post again once I have the answers.

1. Clarification that the full rate reduciton will be passed on to all tracker clients, regardless of if thier margin is above or below the base rate, given the fact that the base rate has not dropped below 3%.

2. Clarification on guidelines as to how much they can potentially alter clients margins if the base rate drops below 3%.

3. Clarification on guidelines as to if the altered margins would continue to be charged should the base rate drop below 3% then subsequently climb back above 3%, given the fact that they have new TCF guidelines to adhere to.


Under TCF, I persoanlly suggest that continuing to charge an increase margin in the event of a fall below 3% followed by a subsequent increase, is something the regulator would have a long hard look at. However we have to accept the fact that these are conditions outlined in the mortgage offer that was accepted.

princess_leia_3

Thanks so much for all this info minimike, I am a Halifax tracker customer so will watch this thread and post any info I get too I hope they do drop the full amount

Edit - I really didn't understand that letter when it came through the other week, so I am off to re-read it now I understand it all! Thank you

minimike2

No probs - Nothing back from them yet, which is to be expected - Hopefully I will get a response tomorrow.

art200380

Mike

Look forward to your response from Halifax.

We are on a BOE tracker which is base rate minus 0.26% so should now be paying 2.74%.

To date Halifax have been upto date and pass on the cut immediately - so our mortgage payment on the 1st of the month following the decision has been reduced.

I agree with your wording on your opening post and the Base rate is now 3% and not LESS THAN therefore if they try anything I will be challenging this in the courts.

Given that the government will soon "own" some of this company and Alistair and Gordon are forever beating on about how important it is for the banks to pass on these cuts - I think Halifax will find increasing pressure to honour the deal.

Fingers crossed anyway!

lwrighty

Mike

I also look forward to your reply.
I'm currently on a tracker deal 0.39% above BOE and mine has the 3% clause, however it does say that if they do change the tracker margin to your disadvantage then you are able come out of your mortgage without penalties within the first 3 months.

Surely they wouldn't be silly enough to put the rate up really high?
I'm just happy to be paying less on my interest only mortgage.
I've gone from £718 to (i think) £460 in two months. I'm just gonna save the extra for a rainy day.