04 Mar Halifax Standard Variable Rate – making you pay Xtra…
This week will mark the three year anniversary when the MPC slashed the Bank of England Base rate to its current level of 0.50%.
All sorts of records are being broken. Obviously the lowest bank base rate since Noah’s ark. But also more telling is the fact that 36 months unchanged is the longest longest period in living memory of unchanged rates.
Halifax have simply had enough. They have, apparently, 1 million borrowers paying their Standard Variable Rate of 3.50%. When they capped their SVR at Bank Rate + 3% – they never dreamed this would become an issue.
It seems they are now a little disappointed by this state of affairs. They have taken the draconian decision to hike their SVR to 3.99% from 1 May. This is a lovely way of increasing some profits from their existing mortgage book.
Say let’s say these estimates are right and they do have 1 million customers with an average loan of £100,000. An increase of 0.49% on all these loans represents a lovely £49.9 million profit each year, from the touch of a button.
The excuses behind this change? None heard yet – yet they will all be excuses, the real reason lies above.
What a business to be in when you can print money this easily! Surely a business that could never go wrong.
Lloyds Banking Group (owner of Halifax) is 43% owned by the tax payer…
No Comments