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Halifax increases rate cap
Halifax is to increase its standard variable rate (SVR) cap from 3% above Bank Base Rate (BBR) to 3.75% above BBR, affecting 40,000 existing mortgage borrowers.
The change will take effect from 31 March and all customers affected by the change will be written to this week to inform them of the change. The change will not affect Halifax’s SVR itself, which remains at 3.50%.
The increase in the SVR cap will only affect borrowers who took out a mortgage prior to September 2007 and have part of their mortgage balance on SVR and another part of their balance subject to an early repayment charge.
A Halifax spokeswoman said: “We have written to all affected customers to explain that, from 31 March 2012, we are amending the cap on the Halifax SVR from 3% above base rate to 3.75% above Bank Base Rate.
“This change does not affect the amount customers pay and the SVR remains at 3.50%.
“We continually assess the many dynamic factors that impact mortgage pricing and have reviewed the current cap level to ensure that it remains suitable in the current market conditions.”