Today (4th March), various lenders – including Barclays and NatWest most recently – have made rate increases which come into effect from tomorrow (5th March).
Newspage asked brokers for their reaction to the rapid-fire rate changes.
Reaction:
Gary Bush, financial adviser at MortgageShop.com:
“A disaster is all you can call all the rate movement from top UK lenders in the past week. Something’s got to change as this hardly fits in with the Financial Conduct Authority’s new Consumer Duty rules.
“To see one High Street lender, Barclays, increasing some of its rates yet decreasing others just creates even more chaos and lack of understanding among consumers.
“How lenders can show resistance to a decent industry 48-hours notice period on mortgage rate changes, quoting it would affect profitability, and then the same lenders all recently announcing huge profits, is head wobbling.”
Charles Breen, founder at Montgomery Financial:
“Lenders are flouting Consumer Duty rules. Rate changes with little, if any notice, are fuelling financial fear in mortgage holders across Britain.
“These lightning strike announcements are leaving both brokers and consumers reeling.
“How can any broker have certainty in their advice with rates liable to change with mere hours’ notice?
“This is more evidence of Consumer Duty Denied for the ordinary borrower.”
Amit Patel, Adviser at Trinity Finance:
“As the Budget inches ever closer, lenders will get more nervous and we will most likely see a wave of activity over the coming hours with re-pricing here, there and everywhere.
“The one thing we won’t see is a 24-hour pledge from lenders, which is what not only what brokers want but would be in the interest of borrowers.”
Darryl Dhoffer, adviser at The Mortgage Expert:
“Yet more rate increases as we get closer to the Budget.
“You have to wonder if lenders increasing rates today have had a heads-up in advance of the Budget.
“We need lenders to commit to a 24-hour pledge of notice, as the notice periods being given are not helping the consumer.
“Brokers are doing their best to help their clients but this kind of mayhem is doing the exact opposite.”
Justin Moy, managing director at EHF Mortgages:
“Another mixed bag of rate increases, and a few reductions, from two of the larger high street banks, again with little time to make calls to borrowers who will potentially be affected.
“As a result, many could end up paying that little bit more for their mortgage or renewal.
“An increase of just 0.1% will cost a lot more than the value of 1% off your income tax for most borrowers.”
Lewis Shaw, owner and mortgage expert at Shaw Financial Services:
“The speed and frequency at which lenders are currently changing their rates feel like an unpleasant rollercoaster ride, except no one can get off and you have to provided a bulk of documents just to get on.
“One moment you’re hurtling downwards and the next your stomach is in your mouth as you race up to an unknown peak unsure where it’s going to stop.”
Riz Malik, founder and director at R3 Mortgages:
“Sometimes we wish our lending partners would listen to what the broker community that originates most of their business are saying.
“We would love the major lenders to seriously consider agreeing to a 24-hour notice period pledge when repricing products.
“Chopping and changing products at short notice does not benefit our customers who are at the heart of what we do.”
Imran Hussain, director at Harmony Financial Services:
“Here we go again. The postive news from Gen H lasted all of about 5 mins before the goliaths decided to pull the sound and ruin the party.
“We need stability in the market so borrowers can plan ahead and know what the heck to do. Right now the speed of rate changes is insane.”
Rohit Kohli, director at The Mortgage Stop:
“The Chancellor has been playing down some of the rumours but with 48 hours to go until the Budget, some of the bigger lenders seem to be getting nervous already.
“Any benefit some Barclays and NatWest customers may have got from Wednesday’s Budget is going to be watered down with higher mortgage payments.
“It’s even more infuriating for borrowers who now need to make snap decisons as lenders return to poor practices of short notice withdrawals.”
Ben Perks, mmanaging director at Orchard Financial Advisers:
“Changes to products this week are to be expected as lenders brace for the Budget on Wednesday.
“SWAP rates have taken a slight uptick, which is hopefully what has triggered these and not that they know something we don’t about the impending announcements on Wednesday.”
