Both Halifax and its sister brand, BM Solutions, have today announced rate cuts on a selection of mortgage products starting from 1st August.
Newspage asked brokers for their views, including on the timing of the cuts, as brokers say end of month announcements can make it difficult for those on Product Transfers to take advantage of these potentially cheaper rates.
Justin Moy, Managing Director at EHF Mortgages said, “More welcome rate cuts from two of the largest mortgage lenders. It’s just disappointing that, yet again, we see the rates changing from the first of the month, meaning those people swapping to new rates via a Product Transfer will potentially miss out on these improved deals.
“Launching those same improvements a few days earlier would give borrowers ample time to make a better-informed decision, and not leave borrowers with a bitter taste in their mouths.”
Olivia Harland, Senior Mortgage Consultant at Cleerly added, “Rate cuts are always welcome as long as they are not withdrawn soon after launch. When they are released at the end of the month after the cut-off to take effect on the 1st of the following month, it can be hugely frustrating for borrowers.
“They face the prospect of being on the hefty standard variable rates, and potentially losing the benefit of the lower rate, or sticking with what they have. No doubt this is intentionally timed by lenders to eke out more of a profit, but it is also very obvious to those on the wrong end of the practice.
“As far as regulation is concerned, the FCA are always careful not to stifle competition and pricing unless it is blatantly unfair to consumers. It is unlikely lenders will be leaned upon to time the availability of product launches in favour of the consumer anytime soon.
“Our advice to all borrowers is to review options for rate switches at least 6 months prior to expiry, which means seeking advice from a broker rather than the lender.”
Leave a Comment