The first comments were in response to last week’s Star Letter about lender pulling mortgage products with short notice: Lenders cannot be expected to sell ‘loss leading’ mortgages – Star Letter 10/06/2022
Arron kicked off the discussion, saying: “Lenders are not selling mortgages at losses, but they want to optimise profit. Many have become inundated with work, so it is possible for them to sell the same loans at higher margins and keep their workflow under control.
He continued: “It is possible that mortgage rates may fall if the housing market slows over the summer, regardless of the base rate. Remember last summer when the base rate was unchanged, but lenders dropped rates as it is costly to have unlent money in their bank accounts, so it was better to lend at sub-one per cent than keep hold of it.”
John Yerou responded, saying: “I don’t think that’s the point he was making. It’s when lenders literally pull products over night with little warning that’s the issue. But I also think that certain lenders are profiteering from the situation.”
Give panel control to brokers
The next article to receive a comment was: The broker fed up with conveyancing setting up his own legal panel
Arron said: “Personally, I would rather see lenders offer cashback alternatives, then brokers can negotiate their own deals. It will spur conveyancers to work harder to win the business. Free legals allow some solicitors to provide an awful service and lenders are typically blissfully unaware.”
