Friday, 1 July 2011

Questions and No Answers

Over the last seven days, I have battled a cold, battled with the Friends Committee over our imminent Ball and battled with HBOS's appointed debt collectors Merrils Ede Solicitors. Feeling the need to take a couple of paces back from the coal face I decided to make use of the good weather to do some errands. It was while driving around it sprung to mind I have been in a difficult spot with the Halifax once before.
In 1987, soon after joining the financial services industry, I remortgage my home with the Halifax so I could finance it's renovation.  As mortgage rates were relatively low at the time, a £165,000 mortgage against a £210,000 valuation was easily affordable.The stock market crash of Black Monday October 1987 changed this situation changed.
While I was kept busy talking to clients about their investments, the chancellor was equally busy pushing base rates up in an effort to curb spending. Before long, mortgage rates had topped 15.4% which almost tripled the mortgage interest payments I had signed up to at outset.  Before long my beautifully refurbished home had also lost 30% in value and it had become clear to me, although I could no longer afford the interest payments, a sale would not cover the outstanding mortgage either.  Even if I had secured a purchaser I had to means with which to cover the anticipated shortfall with either monthly payments or capital.
To help me save my house and avoid mortgage shortfall debt, my local Halifax branch manager agreed to me letting my home  and making partial mortgage interest payments until the economic crisis improved and interested rates dropped. This solution enabled me to meet the majority of my interest payments while riding out the recession. When, as expected interest rates dropped, the Halifax suggested they capitalise the £11,000 of arrears which had accumulated. I did this in1992. I continued to cover the whole mortgage interest payment for years to come and  when I eventually moved back into the house, I sold it and made a sizable profit in April 2000.
The actions I took in 1988 provided a perfect solution for both the Halifax and I throughout the late eighties and early nineties and led to an outcome where neither party lost out. Why, twenty years later, was it so impossible for them to cut me a similar deal in the economic recession of 2008? I can not for the life of me understand why this time it has been better for them to hound me to distraction
Although I know this question is one for which I am unlikely ever to secure an answer, I would certainly appreciate the opportunity to watch somebody from Lloyds, HBOS or the Bank Scotland attempt to provide me a logical reply.

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