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.