Halifax under fire for hiding payback

Halifax has been criticised for hiding early payback features on mortgage offers issued to borrowers.

Andy Wilgoss, managing director of Square Mile Mortgage Finance, told Mortgage Strategy that one of his clients raised the issue when hoping to pay a 10% lump sum prior to retirement. Only after a written enquiry did the lender confirm that the feature would be available.

Though Halifax lists the early payback as a feature in its intermediary literature, it was not listed in the mortgage offer letter issued to the borrower. And although Halifax allowed the payback, Wilgoss argues lenders have a duty to make sure borrowers are aware of features open to them.

He says: “This is a transparency issue. Unlike other lenders this detail has been omitted from their mortgage offers passed to the client. Though the intermediary bulletin will list this to assist the sale, the client may not see it.

“The final confirmed mortgage offer should list what is available to the borrower. By not including it, it seems they don&#39t want to make it outwardly visible and perhaps they don&#39t want too many people to use it.”

Neil Franklin, IFA partner at Bucks-based Franklins Financial Services, adds: “Normally the mortgage offer statement should clarify this itself. If a customer has been presented with a list of options at sale, they should be clear to them in the future.”

But Halifax spokesman Chris Sonne says customers&#39 repayment rights are mentioned in mortgage offers – though the terms of these are detailed in a separate mortgage guidebook. Sonne comments: “If a borrower is concerned, their solicitor should have explained this to them.”