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Halifax climbdown only temporary

Halifax is still planning to go ahead with plans to remove the 10% drawdown facility on its entire fixed rates product range despite protests from brokers.

Mortgage Strategy reported last week that Halifax had decided against removing the ability to pay up to 10% of the mortgage early across its range.

However, sources say that the climbdown is only temporary and that removing the facility from just one of its tracker range options was a stop-gap measure.

The plan is still to remove the facility from the rest of Halifax&#39s trackers with the company&#39s next product change. Depending upon whether there is a shift in the money markets, which means fixed rates would have to be repriced, this move could come either in a matter of days or weeks.

Privately, Halifax has informed brokers that with only 2% of borrowers using the paydown facility, it is seen as a waste of time.

However, the general feeling appears to be that withdrawing the facility will be a mistake on Halifax&#39s part.

Jonathan Cornell, technical director at Hamptons International Mortgages, says: “Psychologically, it is a powerful selling tool even if borrowers do not actually use it.”

And Ray Boulger, senior technical adviser at Charcol, says: “My hope is that if Halifax continues to receive negative input from brokers and from its own sales staff, it will drop the idea.”

The Halifax press office continues to insist that as far as it is concerned there will be no further changes to the 10% paydown facility.

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