MSE News: Halifax to repay £500m to 300,000 mortgage holders

Former_MSE_Guy

This is the discussion thread for the following MSE News Story:

"The bank will pay compensation to borrowers who were given "confusing" information about a cap in interest costs ..."

Read the full story:
Halifax to repay £500m to 300,000 mortgage holders

beecher2

http://www.mortgagestrategy.co.uk/distribution/lloyds-sets-aside-%C2%A3500m-redress-for-300000-mortgage-customers/1026466.article

Bit more detail

The relevant mortgages were written during 2004 – 2007 by Bank of Scotland under the Halifax brand, and through the contact programme, goodwill payments will be made to affected customers.

Graham_Devon

Looks like I may get some compensation or something then?

Not sure what for, mind. But the affected mortgages apply to myself.

Alpine_Star

Lloyds statement to stockmarket http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail.html?announcementId=10793385

opinions4u

http://www.halifax.co.uk/mortgages/help-and-advice/existing-customers/Halifax-Standard-Variable-Rate-announcement/

Relates to the October 2008 change to SVR from 2% above BofE to 3% above BofE which was very much a "survive the Credit Crunch" decision.

Perhaps Yorkshire/Clydesdale should also refund across the board for their calculation error.

beecher2

Thanks for that link opinions4u

Payment will be made to customers that received a Halifax mortgage offer between 20th September 2004 and 16th September 2007, and have been paying SVR at any point since 1st January 2009.

Graham_Devon

opinions4u wrote: »

http://www.halifax.co.uk/mortgages/help-and-advice/existing-customers/Halifax-Standard-Variable-Rate-announcement/

Relates to the October 2008 change to SVR from 2% above BofE to 3% above BofE which was very much a "survive the Credit Crunch" decision.

Perhaps Yorkshire/Clydesdale should also refund across the board for their calculation error.

So looks like they are going to give us the 1% back for each month?

opinions4u

Graham_Devon wrote: »

So looks like they are going to give us the 1% back for each month?

I understand that refunds will be made to the mortgage account. I assume (guess) that the amount will be based on the period of time the account has been impacted - so a maximum of 2 and a half years. Which, if I'm right, would mean some borrowers would see their debt reduced by 2.5%.

I would also assume that the SVR will remain at 3.5% (guess).

So by paying up in April they will cap any liability to longer term payments (guess).

If you are affected, a letter will be sent to you during April. This letter will explain whether or not a payment will be credited to your mortgage, and what the value of that payment will be.

If though, you have a question that is not answered then please call 0800 1412146

The update seems to imply it is merely a 'goodwill payment' for not being so clear about it, as opposed to an actual refund? It's all a bit legal-speak for me

It is legal speak. Halifax can argue that the T&Cs allowed for them to do what they did. The regulator could argue it wasn't clear. If it went to court the decision could reasonably go in favour of Halifax as they stuck to the letter of their T&Cs.

The solution sounds like a way of capping the cost, removing the risk of Halifax losing and also trying to get a bit of good PR out of a situation that would otherwise have dragged on for years.

crispy_chris

The update seems to imply it is merely a 'goodwill payment' for not being so clear about it, as opposed to an actual refund? It's all a bit legal-speak for me

senza7

Hi
Can anybody tell me does this effect me?? I took a 5 year fixed mortgage april 2006 and on my terms says it will revert to SVR 2% when terms ends april 2011? Does this mean i will be paying 3.5%??
angie:-)

chronosman

Does anyone know if this is likely to affect other banks and building societies? I had a similar deal with another bank where I am still stuck on a massive and practically usurious SVR (currently BoE base plus 4.49%). I guess it all depends on the wording on the whether there is a cap or not?