Advice on staff mortgages.

A friend of mine was working for HBOS until a few years ago and always benefitted from the staff mortgage discount. When he left HBOS he contacted the mortgage dept and explained he was leaving and no longer entitled to the staff discount, 3 months later he contacted again fearing he would be hit with a big repayment if the rate carried on at the discounted rate .............. 2 years later he is still getting the discount rate and nothing has been done about it and nobody from HBOS has contacted him to change things. Just wondered if anybody on here knows of any legal reason why he would have to pay the extra amount back or would it be added back to the existing mortgage, it is a lot at £300 pcm difference so will be over 7K by now. He is starting to worry.

If anyone knows of a case like this happening before and knows the outcome i would be pleased to know.

Thanks

Replies

  • edited 31 May 2010 at 4:58PM
    opinions4uopinions4u PPR
    19.4K Posts
    Forumite
    edited 31 May 2010 at 4:58PM
    The terms of the staff mortgage mean that he is liable to backdated interest charges at the standard variable rate rather than the concessionary rate. Whether this would be enforced, or sits comfortably with "Treating Customers Fairly" are matters for debate.

    He may just find it sensible to remortgage elsewhere in the not too distant future. Once the account is closed they'll never spot it ;) .

    Alternatively, carry on as things are and save the difference. Then if they ever do ask for the money it's available. I'm sure he's been doing this all along though.
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