Ombudsman rules against HSBC

THE financial Ombudsman has found against HSBC over dual mortgage pricing. Three lenders – HSBC, Halifax and Nationwide – have been taken to the Ombudsman over their decision to have two different variable mortgage rates. But HSBC is the first to have the final Ombudsman decision.

All three lost at the first stage in their battle with the Ombudsman and were appealing against these judgments. It is widely expected that both Halifax and Nationwide will also now fail in their appeals.

When lenders introduced new lower variable rates they left borrowers with discounted or capped rates on the old higher rate.

About 30,000 HSBC borrowers out of a total 300,000 are on discounted rates linked to the old standard variable rate – currently at 5.74%, rather than the new 4.75%.

Clive Wood, head of banking and mortgages at HSBC said they will not be applying the ruling to other borrowers.