Lenders bite the hand that feeds them by going direct

I was disappointed to discover that Woolwich has brought out a three-year fixed rate product for purchases and remortgages at 5.29%, with free valuations for the latter.

I was disappointed because this is a direct product and not available to brokers. In view of the prevailing market conditions with lenders crying out for help, I find it hard to believe that this mainstream lender would bite one of the hands that feeds it.

My understanding is that two-thirds of mortgage business is written by brokers so it’s a shame that some lenders are offering their best products direct to consumers.

I’ve heard lenders say that brokers have no loyalty and place business where they see fit.

And that’s exactly it. We have to place it where we see fit, guided by the regulator, the Treating Customers Fairly initiative and a file full of comparisons. We must also offer justifications for why we make our recommendations in order to ensure compliance.

So it sticks in my throat when a lender like Woolwich markets excellent products direct and won’t show loyalty to us brokers.

Maybe we should take the same stance and stop submitting business to the lender.

Would that be the best deal for our clients if our sourcing systems show that Woolwich is the best choice?

Would we be compliant if we snubbed the lender because it had snubbed us? I doubt it.

We will carry on trying to give our customers the best advice. But when will lenders learn? If they help us we will help them.

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