Direct action gives lenders upper hand

19 July 2010

Lenders are favouring the high street as the place to do business at the moment and there are some great rates available direct.

HSBC has a two-year fixed rate at 2.69% for those with a 30% deposit, with a decent £1,499 fee. Look at the best broker rates and you can see it’s hard to compete.

Lenders are not shy about advertising direct rates and this is cutting into broker business. For example, a current HSBC advertisement states that its mortgages are not available through brokers. It’s doing this to attract more branch business.

ING Direct, Yorkshire Building Society and First Direct all have decent rates but we can’t access them.

Chelsea Building Society’s five-year fixed deal at 3.99% was one of the best broker rates but this has now been withdrawn.

First Direct has launched a direct marketing campaign offering great rates with some super-low fees, starting at £99.

One of the biggest shocks to brokers was Halifax’s recent marketing campaign halving mortgage fees for direct customers. Despite being the lender of choice for many brokers Santander is not making things easy for us. Some of its higher LTV rates are now 0.5% cheaper direct.

Lenders are becoming increasingly keen to cross-sell products and more are targeting current account business. If this means brokers get cheaper rates we might warm to these deals.

Lenders are increasingly willing to offer exclusive rates and hopefully we’ll see more soon.

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