Halifax to raise SVR

PaulF81

That lifetime 1.99% above base tracker is looking pretty sweet at the moment!

michaels

So I thought there were a whole bunch of legacy mortgages out their which had an undertaking when first taken out that the svr would never exceed the base rate by more than 2% - Nationwide, Halifax and LLoydstsb spring to mind (I think there are some HSBC ones with a 1% promise) and I thought for those customers the banks were just having to suck it up. Does this mean that they are actually rewriting T&Cs post hoc and getting away with it or is it only new customers that are affected?

PaulF81

Where does it say they cant change the SVR?
Tracker is contractual. The SVR isnt.

wotsthat

michaels wrote: »

So I thought there were a whole bunch of legacy mortgages out their which had an undertaking when first taken out that the svr would never exceed the base rate by more than 2% - Nationwide, Halifax and LLoydstsb spring to mind (I think there are some HSBC ones with a 1% promise) and I thought for those customers the banks were just having to suck it up. Does this mean that they are actually rewriting T&Cs post hoc and getting away with it or is it only new customers that are affected?

I'm on the Nationwide BMR which is guaranteed not to be more than 2% above BoE base rate. Nationwide have about 10% of their customers on this rate and they can't put the rate up.

What they did though was introduce a SVR for people exiting new deals. Pre-2009 customers are on BMR and new mortgages since then revert to SVR. To be fair they've kept the promise they made but changed the deal for new customers.

wotsthat

Thrugelmir wrote: »

A good rate if you've finished a fixed rate term and don't have the equity or the financial circumstances to remortgage to a lender such as HSBC.

Across all lenders average SVR is nearly 5% now.

SVR's can be quite deceptive. Average rate being paid across al mortgages is just over 3% (a record low). That means very few people are actually paying SVR's and probably only because, like you say, they have limited options.

Therefore an easy margin enhancement for Halifax targeting customers with the fewest options.

Thrugelmir

Graham_Devon wrote: »

Well I'm on SVR, product taken before 2007. To my knowledge however I'm not split between products. Got the recent payout. Just wondering really whether I will be paying an extra 0.75%.

Possibly.

"The increase from 3.5% to 4.25% comes into force in April and provides the lender with flexibility to increase charges should it wish, although it insisted there are no current plans to do so."

This is notification. If low BOE base persists then the option is available.

Graham_Devon

michaels wrote: »

So I thought there were a whole bunch of legacy mortgages out their which had an undertaking when first taken out that the svr would never exceed the base rate by more than 2% - Nationwide, Halifax and LLoydstsb spring to mind (I think there are some HSBC ones with a 1% promise) and I thought for those customers the banks were just having to suck it up. Does this mean that they are actually rewriting T&Cs post hoc and getting away with it or is it only new customers that are affected?

It seems they are changing rules ad hoc. Halifax already did this, but the powers that be were going to investigate them. Halifax jumped in beforehand and gave out goodwill payments to the customers this had effected. In essence, customers such as myself were not told of a cap, it's not in the agreement.

A cap was then placed on all of these mortgages, ad hoc.

The goodwill payment for adding the cap meant that Halifax could then re-write the terms and keep that cap from that point on.

So I am (and 100's of thouands of others) paying more than I should be (technically according to the terms i signed), which, as stated on my agreement, is 2% above base. I'm actually paying 3% above base. Soon to be 3.75% above base by the looks of things.

RUN_RABBIT_RUN

i guess this highlights the dangers of an svr, where the bank can do what they please with the rate, seemingly even if theres a cap in place. thank god i'm on a fix

didnt skipton do something similar a couple of years ago -i.e. ripped up the rulebook so they could impose a bigger cap?

julieq

Weren't you hoping for increases in mortgage rates Graham to punish the overleveraged, reward the prudent, and push house prices down? Looks like you might get what you wished for coming right at you.

PaulF81

RUN_RABBIT_RUN wrote: »

i guess this highlights the dangers of an svr, where the bank can do what they please with the rate, seemingly even if theres a cap in place. thank god i'm on a fix

didnt skipton do something similar a couple of years ago -i.e. ripped up the rulebook so they could impose a bigger cap?

They cant change trackers either.