The temperature outside may be dropping but, as lenders race to meet their end-of-year targets, whose performance was distinctly chilly during the past quarter and whose lit a fire under the market? Mortgage Strategy’s latest survey finds out.
Whatever the season, Halifax seems able to weather any storm, topping our poll for the fifth consecutive quarter.
“It’s had another great quarter in terms of rates and service,” says Perception Finance managing director David Sheppard, adding that free purchase valuations would further heat up the Halifax proposition.
Trinity Financial product and communications manager Aaron Strutt says: “Advisers like how you can call up and get a case agreed on the same day — subject to valuation.”
Meanwhile, Chadney Bulgin mortgage partner Jonathan Clark praises Halifax for saving clients from “unnecessarily high rates”. He adds: “It will tolerate a modest element of poor credit performance, which other prime lenders would decline.”
Santander for Intermediaries
It’s been a scorcher of a quarter for Santander as the lender climbs two places in our poll. Just Mortgages senior mortgage and protection adviser Matt Tilbury thinks it has “one of the best propositions for BDM support”.
Despite its top rates, Santander’s service has not slipped, says Clark, adding: “It continues to streamline its application process.”
Riach Financial Advisers mortgage adviser Bob Riach has been impressed by “the speed of offers and daily email updates”.
Strutt, meanwhile, thinks Santander’s interest-only policy is a draw. “It requires £150,000 equity in the property at the end of the term,” he says. “With other lenders it’s much higher.”
RBS (NatWest Intermediary Solutions)
It was clear skies for RBS last quarter and the lender has maintained third position. London & Country associate director of communications David Hollingworth commends its service.
“Adding cashbacks into the equation helped deliver a strong quarter,” he says.
Strutt welcomes the lender’s income multiples and rates. “Once cases are submitted, they go through smoothly,” he says.
Clark adds: “NatWest will consider cases outside its normal criteria but its low proc fee and overdue product transfer facility still frustrate.”
There were a few clouds over Virgin last quarter, leading it to drop two places to fourth. Although Sheppard welcomes its broker support for new business and rate switches for existing borrowers, he says: “Its porting applications, which still have to be done on paper, need improvement.”
Clark feels Virgin is doing every-thing right to attract business but its rates have “gone off the boil recently”. However, SDL Group commercial director Rob Clifford says: “Virgin scored highly due to its excellent BDM support.”
Coventry warmed up considerably last quarter, gaining two places on the leader board. Personal Touch Financial Services head of propositions Victoria Jefferies says: “Coventry consistently provides strong service and products.”
Clifford’s advisers praise the lender for “excellent BDMs, who can provide fast offers”, while Hollingworth says: “Coventry will try things others aren’t doing, such as seven-year fixes.”
Clark also appreciates Coventry’s fixed rates, but adds: “Its relatively strict affordability calculator and inability to take different income sources into account are holding it back.”
Barclays had a mild quarter and maintained sixth position.
“These days it’s expected that Barclays’ service level will be consistently good,” says Hollingworth. “When it adds aggressive pricing to the mix, including leading two- and five-year fixes, it’s a hard act to follow.”
Clark praises the lender for a number of market-leading products. “Its product transfers are even sharper, so it’s no surprise it is finding favour with brokers.”
YBS (Accord Mortgages)
It was an unsettled quarter for Accord, resulting in a fall of two places.
“Service slipped a bit, with offers not as fast as they were,” says Sheppard.
According to Clark, although Accord’s rates are no longer market-leading, it has “excellent service and BDM coverage, with underwriters prepared to stretch affordability for the right client”.
Hollingworth adds: “This quarter gave a stark reminder of its ability to price when it opened its 0.99 per cent two-year fix to 80 per cent LTV.”
Meanwhile, Alexander Hall technical director Richard Merrett welcomes the lender’s loan-to-income changes. “This aided affordability for a broader spectrum of clients,” he says.
Nationwide for Intermediaries
Things look brighter for Nationwide as it gains one place in our poll. John Charcol managing director Walter Avrili commends its “very swift and effective product transfer service”.
Riach cites “generous affordability calculations” and “consistently good service”, but Sheppard disagrees. “A case was referred to surveyors who did not seem to know why; this led to an eight-day delay,” he says.
Tilbury calls Nationwide’s processing systems and times “poor”, adding: “Its lack of BDM coverage and support is also an issue that needs to be resolved.”
HSBC has replaced Clydesdale Bank on our panel, with brokers becoming acclimatised to its ways. Strutt praises its BDM. “Without her we would not have been able to get clients such fantastically low rates,” he says. However, Tilbury is keen to see a new online system.
“To provide an excellent service, lenders need to offer an easy-to-use online system — something HSBC currently fails to do,” he says.
Sheppard, meanwhile, is getting to grips with the lender’s processing. “It’s not always clear which fees are payable, even when outlined on the key facts illustration,” he says.
TSB Bank suffered a cold snap this quarter, dropping one place to ninth. Clark says: “TSB’s rates continue to languish down the best-buy tables and its delayed product transfer facility frustrates brokers.”
Hollingworth, however, says some of TSB’s remortgage five-year fixed rates performed “very well”.
Riach is a fan but says rates have only recently become competitive, with the launch of several fixed products and rate cuts on existing deals for homemovers and remortgage borrowers.
“I’ve had good service from TSB in the past, so I hope it
will continue and improve,” he says.
Wild card: Precise Mortgages
Precise is this quarter’s Wild Card. Hollingworth says: “Precise offers something different. It’s a dynamic lender that’s ready to identify alternative markets, backed by a committed sales team.”
Clark adds: “Precise offers a home for the most challenging cases with instant online underwriting decisions and cascade pricing.”
Tilbury praises the lender’s improved Help to Buy products but says: “It needs to strengthen its broker support capabilities; its existing systems are not sufficient.”
Merrett adds: “Precise has concentrated mainly on buy-to-let, where it excels. It would be good to see more residential innovation.”