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So, Hbos Called Me Today About A Mortgage

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I have a small repayment mortgage with HBoS - Halifax as was - (around 4 or 5% LTV) with a term to April 2021. It is small because I have overpaid it from day 1.

Anyway, someone from HBoS called me this morning to tell me (not in so many words) that they would prefer that I either paid it off in full or borrowed some more (up to 65% LTV without a new application necessarily being required) than let it run its natural course.

I told her that I was quite happy deciding what I wanted to do with it on my own and that, having repeatedly expressed a preference for no marketing calls / emails / post, I didn't expect any more calls on the matter thank you very much.

We bid each other good day and she was gone.

The more I reflect on the call, the odder it seems.

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You're a cost to the bank. They could either be lending your money out for more or the administration costs of smaller LTVs are not worth it to them. They would rather you pay it off or take more debt on. Although remember, when you pay it off they give you your deed which most likely you need to put in a safe or safety deposit box. Its probably cheaper just to pay HBos £1/mth to hold on to it for you.

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I told her that I was quite happy deciding what I wanted to do with it on my own and that, having repeatedly expressed a preference for no marketing calls / emails / post, I didn't expect any more calls on the matter thank you very much.

Alternatively, your response could have been "Make it worth my while".

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Although remember, when you pay it off they give you your deed which most likely you need to put in a safe or safety deposit box. Its probably cheaper just to pay HBos £1/mth to hold on to it for you.

Not true any more - you don't need deeds these days, it's all on the Land Registry

http://www.landregistry.gov.uk/public/faqs/where-are-my-deeds-kept

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You're a cost to the bank. They could either be lending your money out for more or the administration costs of smaller LTVs are not worth it to them. They would rather you pay it off or take more debt on. Although remember, when you pay it off they give you your deed which most likely you need to put in a safe or safety deposit box. Its probably cheaper just to pay HBos £1/mth to hold on to it for you.

Thought deeds were largely obsolete these days?

Land titles are held electronically at the Land Registry..

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Yes, banks don't like people they can't make much money on. They hate it if you always keep your current a/c in the black and don't ever incur any fees for going overdrawn etc. I must be one of their worst ever customers.

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Well yes, if it is that much of an inconvenience to them, I wouldn't object to them writing off the balance, closing the account and sending me the deeds etc.

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I think they would like you to remain in debt £25K plus.........having a small debt means you are an existing customer and can top up when you want with a phone call without all the extra fees, cost of valuations that goes with going to a new provider.

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Thought deeds were largely obsolete these days?

Land titles are held electronically at the Land Registry..

If you look at a land registry print out of a title deed it says something along the lines of it being an approximation of the deed but not detailing the exact scope of the deeds.

We have particularly complex deeds with multiple reciprocal rights of way and partial ownership of each others gardens (row of old farm cottages with what was a jointed owned privy in one of the gardens). The land registry entries for the cottages simply make reference to the definitive historic deed which sets out all the details but without actually stating what that deed says.

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In the past Halifax have expanded massively including a takeover of the large (and disorganised) Leeds permanent.

If they are phoning you up theres a good chance they know they have lost the deeds and all the generous offers to extend your mortgage or 'look after them' in the Halifax deedstore is just a ruse to buy them some more time.

Edited by oligotroph

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If you have been making overpayment, you can probably call this money down from them, so they have a cost of capital for money that isn't at work and is unlikely to be, but could be called and so they will have to maintain some element of capital.

I've had similar letters from by division of Lloyds, HBoS. They are not offering me more money though, but keep suggesting that they will not be serving me very well, not doing new business etc and I may want to leave without penalty. I'm sure its just concern on their part rather than my Base +0.62% offset tracker not making them much money.

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If you have been making overpayment, you can probably call this money down from them, so they have a cost of capital for money that isn't at work and is unlikely to be, but could be called and so they will have to maintain some element of capital.

I've had similar letters from by division of Lloyds, HBoS. They are not offering me more money though, but keep suggesting that they will not be serving me very well, not doing new business etc and I may want to leave without penalty. I'm sure its just concern on their part rather than my Base +0.62% offset tracker not making them much money.

There is a classic article on the FT site today.

Entitled "UK regulator warns banks on mortgage capital levels" so you might think they have to keep more capital etc etc.

The conclusion is this

"Banks can arbitrage that by getting out of low risk-weighted mortgages and moving into higher risk loans"

http://www.ft.com/cms/s/0/98905000-05c8-11e4-8b94-00144feab7de.html

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I have a small repayment mortgage with HBoS - Halifax as was - (around 4 or 5% LTV) with a term to April 2021. It is small because I have overpaid it from day 1.

Anyway, someone from HBoS called me this morning to tell me (not in so many words) that they would prefer that I either paid it off in full or borrowed some more (up to 65% LTV without a new application necessarily being required) than let it run its natural course.

I told her that I was quite happy deciding what I wanted to do with it on my own and that, having repeatedly expressed a preference for no marketing calls / emails / post, I didn't expect any more calls on the matter thank you very much.

We bid each other good day and she was gone.

The more I reflect on the call, the odder it seems.

I have an interest only offset mortgage with the Natwest with £910 left to pay; I try to keep my current account above £911 and just use it as an overdraft.

At 4% it works out about 1p per day to borrow £100.

They do make me pay a minimum of £4 per month of the capital so it is reducing.

Natwest have never complained yet but I am expecting them to.

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