Lenders need to take care not to damage the intermediary channel by using the wrong tool.
At the Association of Mortgage Intermediaries we understand that branches need to meet targets but pricing is not the way to deliver more customers to branches. While lenders may choose to pursue this strategy, it will fail to achieve its desired objective.
It is an instrument being employed to try to balance the volumes of traffic flowing into the direct and intermediary channels.
But customers do not work that way. They either shop around then buy direct or go to brokers for advice. Not enough lenders offer that full advice option. If customers shop around then products such as those from HSBC that only operates direct tend to look attractive.
Other lenders have products at certain LTVs, term and type, which are also competitive. But differential pricing does not tend to change consumer behaviour. People go to brokers for advice on the best type of mortgage and to help them manage the process.
Headline rates are not always the best buy, as other factors might be relevant. This is why brokers have flourished.
Lenders struggle to drive consumers to branches as those who will go direct are either existing clients or shopping around, not those who use brokers. Playing with rates will not change human behaviour.