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

curlygirl1971

Darryl - were you locked into your SVR by charges?

"It will pay £250 to all customers locked into the SVR by charges. Customers who are not locked in will receive the difference between the amount of mortgage interest they have been charged since 1 January 2009 and what they would have paid if the interest rate had been capped at 2% above base rate." (From the Which? Website 22/02/11)

Could this explain why you've only got £250?


Incidentally - the Halifax have updated their Statement on their website to the following (no major updates):-
Information about the announcement on our Halifax Standard Variable Rate

You may be aware that we are writing to some of our Halifax mortgage customers. These are customers who were sent a mortgage offer between 20th September 2004 and 16th September 2007 and still held that mortgage in January 2009. Wording in the mortgage offer document sent during this time might have had the potential to cause confusion.
This was in relation to the summary of the Halifax SVR cap which was included within the mortgage offer document. Therefore we are writing to customers to ensure that they are fully aware of what the SVR cap is and how it relates to their own borrowing.
Customers do not need to take any action. We are committed to ensuring that customers have a clear understanding of how their mortgage works and will proactively contact all customers affected from April 2011. Some affected customers will receive a goodwill payment.
Below is a list of questions and answers we have prepared. If you have a question, that has not been answered here, please check back soon to see further updates.
1. Does this affect me?
If you took your Halifax mortgage out with us after being sent an offer between 20th September 2004 and 16th September 2007, you will have received a mortgage offer which had a summary of the cap.
If you remained on the same mortgage conditions on 1st January 2009, you are affected and will be sent a letter during April. The content of that letter will depend on your individual circumstances.
2. Will I get a goodwill payment and how much will it be?
Unfortunately, we cannot confirm here how individual customers are affected. However, you do not need to take any action at this point. 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.
3. How will you decide who gets a goodwill payment?
Payment will be made to customers that were sent a Halifax mortgage offer between 20th September 2004 and 16th September 2007, and have been paying SVR at any point since 1st January 2009 while still on the Halifax Mortgage Conditions 2004 (2nd Edition).
4. What if I want to transfer to a new product now? Will I lose any entitlement I might have to a goodwill payment?
No. If you are entitled to a goodwill payment, you will receive a letter from us during April, and transferring to a new product will make no difference.
5. What about customers who took a Halifax mortgage after being sent an offer between 20th September 2004 and 16th September 2007 who have now left the Halifax?
We will be writing to affected customers including those who have since repaid their mortgage account with us.
6. Why did you increase the cap?
The terms and conditions allow us to vary the cap. We changed the cap in October 2008 because of significant increases in the cost to us of borrowing the money we lend to mortgage customers.
Despite this change, the Halifax SVR (currently 3.50%) remains below the level of most other mortgage lenders.
7. If I’m entitled to a goodwill payment but my mortgage is in arrears, will I still get it?
If you are eligible, you will receive a letter in April and this will detail any goodwill payment where appropriate. Any payment will reduce the arrears balance first.
8. What if I want the goodwill payment paid into a different account/by cheque or cash?
If you would like the payment to be made by a different means then please contact us on the number shown within your letter.
9. If I took out my mortgage after being sent an offer between 20th September 2004 and 16th September 2007, why might I no longer be on the same mortgage conditions?
Because if you had a further advance or a product transfer since 16th September 2007, you will have moved on to the current mortgage conditions that do not include the Halifax SVR cap.
10. If I want to overpay a further 10%, does the goodwill payment go towards this amount?
No, you are able to overpay by a further 10% as the goodwill payment is not included as part of this allowance.
11. What guidance can you give on UK tax treatment for UK resident customers receiving an ex gratia payment
The following comments are intended only as a general guide to current UK taxation and what is understood to be current UK HM Revenue & Customs practice, both of which are subject to change at any time, possibly with retroactive effect.Tax can be complicated and individual circumstances may need to be considered in more detail. Any person who is in any doubt as to his tax position should consult his own professional adviser.

This general guidance applies where:
• The customer is a UK resident individual
• The mortgage was used for the purposes of purchasing a UK residential property that is occupied by the customer.

We expect that an ex-gratia payment received by an individual customer under this programme will not be subject to UK income tax or UK capital gains tax.
We will be updating these Q&As as we understand the questions that our customers are asking. If though, you have questions that are not answered here then please call the number contained within your letter.
If you are affected you will be written to by the end of April and this will contain details of your situation. You do not need to take any action now but if you do have a question then please call 08457 27 37 47, option 1.

darryl6574

No I was not tied in to the SVR, I was and still am able to change lender without any penalties. My initial 5 year fixed deal ended October 2009.

curlygirl1971

Hhhmm will have to wait and see what other people get / post on here

Hope there is a letter waiting for me at home....

lanemondo

darryl6574 wrote: »

No I was not tied in to the SVR, I was and still am able to change lender without any penalties. My initial 5 year fixed deal ended October 2009.

thanks for the update, the only thing I could say that might help others is that on the Halifax web it states. If you received a halifax mortgage offer between 20th Sept 2004 - 16th Sept 2007 it affects you.

Can you confirm the date of your mortgage offer? it looks like it could be very close to the 20th Sept 2004?

darryl6574

My mortgage was taken out at the end of September 2005 over 5 years, I then had a further advance which was 12/9/2007 which was also due to end in 2010. When the interest rates was rising in 2009 I rang the Halifax to see what the redemption penalty would be to change a year earlier and at that time they asked if I wanted to come of the fixed deal with no penalty which I did and probably could not of timed it better due to the drop in the SVR.
When I rang today they told me I was in the period but she asked me where I got the information that I would receive 1% from Jan 09 as Halifax have not made any suggestion that this would be offered.
So if anybody does get offered any more than the £250.00 then please let me know as I will make another call as it should be £250.00 or 1%.

lanemondo

Must admit, I haven't seen anything to suggest 1% off per month off the halifax

curlygirl1971

darryl6574 wrote: »

.....she asked me where I got the information that I would receive 1% from Jan 09 as Halifax have not made any suggestion that this would be offered.

Very odd.

Both MSE on 21st Feb and Which? 22nd Feb (and probably others reported):-

• If you have a Halifax mortgage where you are free to leave, without penalty, on the SVR, you will receive the difference between the interest charged and what you would have paid with the 2% cap between January 2009 and April 2011 (or earlier, if you have since paid off the mortgage).
• Some Halifax mortgage holders on the SVR will be tied in (meaning they must pay a penalty to leave). These customers would have been told about the removal of the cap, the bank stresses. Nevertheless, they will receive a "goodwill" payment of £250.

........so, have their reporters got it wrong? - which is unusual - they normally have good insider knowledge.

In addition all news sources were reporting that the Halifax were going to pay £500million to 300,000 customers - this means an average of £1666.67 per customer

The BBC reported on 21st Feb "Halifax said that some customers would receive a flat-rate payment of £250. Others will receive a variable payment, related to the rise in their interest payment and the size of their mortgages. This could range from hundreds of pounds to several thousand pounds."

lanemondo

curlygirl1971 wrote: »

Very odd.


Both MSE on 21st Feb and Which? 22nd Feb (and probably others reported):-

• If you have a Halifax mortgage where you are free to leave, without penalty, on the SVR, you will receive the difference between the interest charged and what you would have paid with the 2% cap between January 2009 and April 2011 (or earlier, if you have since paid off the mortgage).
• Some Halifax mortgage holders on the SVR will be tied in (meaning they must pay a penalty to leave). These customers would have been told about the removal of the cap, the bank stresses. Nevertheless, they will receive a "goodwill" payment of £250.

........so, have their reporters got it wrong? - which is unusual - they normally have good insider knowledge.

In addition all news sources were reporting that the Halifax were going to pay £500million to 300,000 customers - this means an average of £1666.67 per customer

The BBC reported on 21st Feb "Halifax said that some customers would receive a flat-rate payment of £250. Others will receive a variable payment, related to the rise in their interest payment and the size of their mortgages. This could range from hundreds of pounds to several thousand pounds."

Best waiting to see what anybody else gets but worth checking for quotes directly from the Halifax/Lloyds

darryl6574

After 3 further phone calls I have now been told that one of my further advances ended and went to the svr in sept/oct 08 and I was sent a letter about the rate changes. I have looked and do not seem to have had this letter but I did have letters about the rate going down when the base rate drop but it does not say about the capped rate changing. Should I follow this up as I would of thought I should of received a letter which states a change in terms and conditions.

lanemondo

darryl6574 wrote: »

After 3 further phone calls I have now been told that one of my further advances ended and went to the svr in sept/oct 08 and I was sent a letter about the rate changes. I have looked and do not seem to have had this letter but I did have letters about the rate going down when the base rate drop but it does not say about the capped rate changing. Should I follow this up as I would of thought I should of received a letter which states a change in terms and conditions.

I would wait and see what happens over the coming days.
See what other people get and then argue the toss.