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GMAC pulls 25-year fixed rate deal

GMAC-RFC has pulled its innovative 25-year fixed rate mortgage, blaming rising swap rates and lack of demand just two months after its launch.

Despite garnering publicity in the national press the deal ultimately failed to deliver volume sales.

When the product was first released in February it was hoped it would help make longer term fixes more attractive in the wake of the Miles review.

As part of the mortgage, borrowers would pay no more than 5.95% for the next 25 years on the fixed rate element.

This could then be combined with a penalty-free base rate plus 0.75% tracker in five customised options.

Jeff Knight, head of sales and marketing at GMAC-RFC, says: “Swap rates went up recently and GMAC-RFC has had to reprice all its fixed rates. The product was designed to test the demand for this sort of mortgage.”

The company says that while it remains committed to developing products it has no plans to re-enter the 25-year market in the short-term.

Rob Clifford, managing director at mortgageforce, says: “There is mass disinterest in long-term fixes and I don&#39t expect any lender who designs such products to see significant business volumes.”

And Tim Dawson, chief executive at Mortgage Express,adds: “I don&#39t think the current shape of the market and attitude of customers sits well with a 25-year mortgage. The only way to offer a 25-year deal is to price it so competitively that you&#39d be a fool not to take it.”


Pink appoints London BDM

Pink Home Loans has appointed Chris Fyfe as business development manager for the central and north London region. Fyfe joins Pink from GMAC-RFC, where he held the position of regional sales executive. Before joining GMAC-RFC, Fyfe spent over five years with Mortgage Express in various departments including new business and business development, and was also […]

TMB unveils its online system

The Mortgage Business has unveiled its online case processing service for brokers and will relaunch its entire product range next month. The HBOS subsidiary says the online system has been designed to incorporate the firm&#39s own flexible underwriting system, will be easy to use and will allow for faster mortgage decisions and quick offer turnarounds. […]

House prices rising twice as fast as in 2003, says Rightmove

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NGM seeks regional satellite packaging partners

Next Generation Mortgages has launched a major offensive to recruit 20 quality intermediaries capable of becoming the company&#39s first regional satellite packaging partners. Cardiff-based NGM, a major partner to lenders such as igroup, SPML, TMB, Preferred Mortgages, First National, Mortgages PLC, Platform and Future Mortgages, is offering an attractive range of benefits and support services […]


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