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Marketwatch 30/03/2009

Swaps had another mixed week, with short-term money falling and longer term money edging up.

Three-month LIBOR is now 1.71%.
1-year money is down 0.05% at 1.66%
2-year money is down 0.02% at 2.19%
3-year money is up 0.05% at 2.57%
5-year money is up 0.08% at 3.08%

Santander kept us all busy last week making numerous changes to its proc fee structure, solicitors’ panel and products. This involved a massive number of emails.

The most significant change is to proc fees. Both Santander’s lenders – Abbey and Alliance & Leicester – are now actively discouraging directly authorised business that is not submitted through clubs.

If you are not a key account, ensure that when you submit your applications you select a mortgage club or you will be paid a miserly 0.2%. If you submit through a club you will get at least 0.34% for a standard mortgage and 0.44% for a flexible mortgage.

Abbey has slashed its solicitor panel, culling firms that have not undertaken any transactions with the lender in the past 12 months.

The lender wrote to companies advising them of this development but sadly, due to a data extraction error, a number of firms that have acted or are acting on mortgage transactions were removed erroneously. These companies are being reinstated as soon as Abbey is advised of their situation.

On the product side the lender has introduced a two-year fixed rate for purchases up to 75% LTV which is exclusively for brokers. This has a market-leading pay rate of 3.99% and no booking fee.

Meanwhile, A&L has launched a competitive two-year fixed rate at 5.79%, available up to 85% LTV with a 1% fee, free valuation and £200 cashback.

Woolwich sent out a positive sounding email stating that as result of an opportunity presented by a reduction in the cost of fixed rate funds, the rates on selected products across its range were being reduced.

While it is heartening to see Woolwich’s rates heading south, they now seem to be at around the levels its rivals are offering.

The email made life easy for us by listing new rates, the rates that were being withdrawn and those that were not being altered.

Woolwich scores lots of points with me by having a service update facility that uses a traffic-light system.

And don’t forget, it’s also one of the rare lenders offering something called a buy-to-let mortgage at the moment. It has a two-year ‘fix and track’ deal at 3.89% that reverts to base rate plus 1.49%. The fee for this is £995 and the maximum LTV is 60%.

The lender’s core three-year fixed rate is 3.89% with a £995 fee and maximum LTV of 60%.

And speaking of lenders that show service standards on their websites, the pioneer of this was Accord Mortgages which has recently reduced a number of rates.

The lender’s two-year fixed rates have gone down by 0.2%, its three-year fixed rates have reduced by 0.1% and its five-year fixed rates have gone down by 0.4%.

Meanwhile, Halifax has slashed a number of product transfer and further advance rates. There is now a four-year tracker at 3.29% for loans between 90% LTV and 95% LTV with a £1,249 fee.

I’m sure this will be popular but it’s a shame acquisition rates aren’t quite so generous.

I’d have thought Halifax could afford to be slightly tougher as existing borrowers at this sort of LTV don’t have anywhere to remortgage to at the moment.

If you are not already a member of the Association of Mortgage Intermediaries I urge you to join as soon as possible.

The organisation does a huge amount of lobbying on behalf of our industry behind the scenes with parties including the Financial Services Authority, politicians and European regulators, and its factsheets alone are worth the reasonable membership fees.


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