Halifax has agreed to pay out £500m in compensation to 300,000 customers after admitting causing confusion about whether a cap on its standard variable rate mortgage applied to them.
Halifax Mis-Sold Mortgages
The Halifax-based bank, which is part of Lloyds Banking Group, has reached a voluntary agreement with the Financial Services Authority to pay the redress.
It was acknowledged that Halifax’s mortgage offer documents had the potential to cause the confusion. Anyone who took out a Halifax mortgage between 20 September 2004 and 16 September 2007 will be affected by the announcement.
Lloyds Banking Group said in a statement: ‘Halifax is committed to operating with the highest levels of integrity and treating customers fairly and felt that a proactive coordinated programme to contact affected customers and make goodwill payments was the appropriate course of action.’
The payout relates to Halifax’s cap on its standard variable rate mortgage from 2 per cent above the Bank of England base rate to 3 per cent above it.
Halifax mortgage offers issued had not made clear the lender’s terms and conditions meant it could later vary the charge for customers who went onto its standard variable rate (SVR).
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