Research from Moneyfacts, proclaiming that mortgage rates had returned to the same levels as at the onset of the credit crunch, may seem outlandish. While even the least pragmatic of us would be wise to keep the champagne on ice, it is clear that rates have begun to ease somewhat of late.
A raft of rate cuts from the likes of Halifax, Cheltenham & Gloucester (C&G), Abbey and Nationwide has brought some much needed competition back into the market. C&G led the way, taking the aggressive step of cutting rates to table-topping levels across its ranges.
As a result, the week has seen the market come closest to what could be labelled a ‘price war’. Intermediaries will no doubt remember that just a few months ago, lenders were afraid of being caught cold at the top of the best buy tables. Rate changes were frequent, and any product that appeared even slightly competitive would be pulled faster than Usain Bolt in full flight. It is still too early to know how lenders will react to the recent increase in competition as they look to capture market share. One thing is certain, this growing appetite to lend can only be a positive step for the industry.
While rate cuts suggest a brighter outlook for intermediaries, the packaging sector was dealt yet another blow with the news that BM Solutions is offering packagers smaller procuration fees than previously provided by departing brand TMB.
Despite the reduction in packager fees, optimism remains high that BM’s managing director Nigel Payne will continue his packager-friendly stance and adopt a similar approach with the brand after supporting packagers with TMB. The industry will have to wait and see just what BM has planned for the sector, but it is clear the packager world will be watching with baited breath. n
