Tuesday, 22 February 2011 11:49 AM
More than a quarter of a million UK homeowners could soon receive compensation after Halifax was found to have deceived a large number of its mortgage customers.
Lloyds Banking Group has announced that it has signed a voluntary agreement with the Financial Services Authority (FSA) regarding the cap on a standard variable rate (SVR), which is paid by borrowers who are not on a special home loan offer.
Halifax mortgage customers who took out their agreement between 2004 and 2007 could receive refunds from the lender due to unclear wording in contracts which may have caused confusion.
The misleading information related to a cap on the bank's SVR rate, which it is thought could have led customers to think they were eligible for it when in fact they were not.
Now, a total of £500 million has been allocated by the Lloyds Banking Group to reimburse the 300,000 mortgage customers affected.
The banking group, which owns Halifax, said that it "believes that a proactive co-ordinated programme to identify affected customers and make goodwill payments is the appropriate course of action".
Payments will be made to customers who received a Halifax mortgage offer between September 20 2004 and September 16 2007 and have been paying the SVR at any point since the January 1 2009.
The amount of money received by each borrower will relate to the difference between repayments if the SVR had been two percentage points above the Bank of England base rate and the three points above at which it was charged.
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