Halifax - Two Tier Rates Annoyance

csisimc

My tracker mortgage deal with the Halifax ends at the end of this month.

My current balance with them is £48,500 half interest only, half repayment.
They have offered me a Tracker or 2-3 Year Fixed at the very uncompetitive rate of 6.39 %. However what irks me is that if I had > 50K outstanding they would immediately offer me a rate of 5.39%.
I am pretty miffed about this arbitrary approach by them that penalises me for having a smaller mortgage (6years left to run).

Can any MSE'rs offer me any advice ? I would like to challenge this with the Halifax - or shop around for a better product/rate but do not want to extend the term of the mortgage further ie 6years left to run.

Any help would be very much appreciated.

:cool:

regularsaver1

Until recently they had about 4 tiers - under £30k you literally couldn't get a rate - they have now changed this. it is better than it was

Claire_Jones_3

Phone them up and ask for a redemption figure and tell them you are looking to move to another provider and all of a sudden another better rate will appear!

I work for a bank dealing with mortgages so I know the procedures, good luck!!

regularsaver1

This will not happen - they can not produce another rate for you. It is those that are offered or not. I have done plently of product transfers for them and they will not

This is the below £50k fixed offer - shown on website:

http://www.halifax.co.uk/mortgages/fixedswitch2008.shtml#less_than_50k

& http://www.halifax.co.uk/mortgages/fixedswitch2011.shtml

or term tracker: http://www.halifax.co.uk/mortgages/trackerswitchterm.shtml#less_than_50k

This can't be changed

Claire_Jones_3

I appreciate they can't just create another rate but they can give them the better one for above £50k if they think they will lose the business.

Failing that transfer to another lender, there are so many who do free legals, valuations etc. There is one rate I have seen this week for 1.99% for 1st yr and then 5.99 for next 4yrs and I think it averages at 5.29%ish so when the base rate is 5% Halifax could do better if they wanted to!

regularsaver1

Yeah I have heard Halifax are brining out somwthing similar but not sure when. I can just imagine what the early repayment charges are though! I heard to arrangement fee is £999

They will not change the rate to the one over £50k.

Always account the £175 early discarge to leave early and £50 deeds dispatch fee

mrcow

Maybe I'm looking at this a little too simplisically (but it's what I would try and do)? But can you not borrow the extra £1500 required to get the lower rate and then overpay that amount on the mortgage once it has cleared through?

Acording to their website, even though there are early repayment charges, you can still overpay up to 10% within any 12 month period which would easily cover the £1500?

regularsaver1

To borrow more money you are credit scored and there is a further advance fee of £299 - so not really worth it

Both further advance and product fee apply - you are not remortgaging. You are doing a product transfer

Rick62

I agree, increase the mortgage to £50,000 when you take the new rate, then pay back the extra £1500 (unless you need/want it for something).

I assume there will be a product fee when you remortgage, so you should not also be charged a further advance fee. It should be pretty straightforward, a phone call, then sign and return an offer document.

Alternatively you probably could do better elsewhere, but with costs and the size of the mortgage the savings might not be worth the hassle.

regularsaver1

Both fees apply - although I know brokers can do product transfers and further advances for existing Halifax customers now and get the same fee as though they would if it was a new customer - so not sure if they have a different deal with fees

I have done a £110k further advance keyed, signed and completed in an hour, so it doesn't take long - thats face to face. Obviously longer if over phone

MarkyMarkD

regularsaver1 wrote:

To borrow more money you are credit scored and there is a further advance fee of £299 - so not really worth it

Both further advance and product fee apply - you are not remortgaging. You are doing a product transfer

I don't quite understand your maths.

Borrowing an extra £1,500 at a cost of £299 will lead to a saving of 1% a year on £50,000 = £500 a year. Sounds very much worth it to me.