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New Skipton product is given short shrift

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  • 08/09/2003
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Skipton Building Society's new four-year base rate tracker product has been blasted as 'uncompetitiv...

Skipton Building Society’s new four-year base rate tracker product has been blasted as ‘uncompetitive’ by a leading mortgage broker.

The mortgage lender launched the new product at the beginning of September to replace its 4.15% base rate tracker offering.

The direct business product offers a 3.74% rate, consisting of the bank rate plus 0.24% for four years. By contrast, the introduced business-only offering has a 3.99% rate, the bank base rate plus 0.49% over four years.

Ray Boulger, senior technical manager at Charcol, said: “It is ridiculous. A differential of 1% over the term of the deal cannot be justified. The offering is uncompetitive, and it is unacceptable that Skipton should be offering a product which is so much worse than the one being offered through branches.”

Martyn Bell, head of product development at Skipton Building Society, hit back, saying: “We have a competitive range of products and the issue should be about the overall rate, rather than any differential.

“The cost of origination is more for a broker-supplied mortgage, rather than a direct one, mainly due to procuration fees and this is reflected in the marginal difference between each product’s rates.”

Both the Skipton products have no early redemption charges.

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