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Halifax denies wanting to kill off remortgaging

Halifax has denied that its reason for offering a retention fee is to kill off the remortgaging market.

Alan Cleary, managing director of edeus, is warning brokers not to be fooled by the offer of a short-term fix but instead to consider the longer term implications.

He says: “Lenders in the prime sector can’t make money given the dynamics of today’s prime business. A typical prime deal at 0.25% above the base rate will have a life of 2.6 years, down from seven years in the early 1990s. Therefore, the lender will make 0.25% x 2.5, which equals 0.625%.

“After paying the broker 0.35%, the cost of processing at 0.15% and the cost of servicing at around 0.25% plus any other associated costs there’s no money in it.”

But Nigel Stockton, managing director of HBOS Mortgage Intermediaries, says: “We don’t think the remortgage market will disappear and this certainly won’t be the end of it. We don’t expect everyone to stay with us. All we’re doing is giving consumers and brokers a choice.”

And industry pundit Brian Pitt says: “Halifax’s offering will have to be pretty impressive to stop brokers from searching the market, which is what they are obliged to do in the interests of treating customers fairly.”


Dubai firm buys Hamptons for 82m

Hamptons International – parent group of Hamptons Mortgages – was sold last week for 82m to Dubai-based Emaar Properties by owner Wheelock Properties. The group says the news will be a boost for the entire Hamptons UK operation including the estate agency business and the mortgage brokerage. Kevin Duffy, managing director of Hamptons Mortgages, says […]

Rate change will hit borrowers, say Lib Dems

The Liberal Democrats say the rate change last week will hit those in debt, especially borrowers with variable rate mortgages.Shadow chancellor Vince Cable says: The rise in interest rates points to serious concerns over high energy and house prices.“The impact of this rate rise will be felt most severely by those with variable rate mortgages.“At […]

Listening to the consumer’s voice

Last week I explained in brief the role of the Financial Services Practitioner Panel and the Smaller Business Practitioner Panel. This week it’s the turn of the Financial Services Consumer Panel. This panel was set up by the Financial Services Authority under the Financial Services and Markets Act 2000 and its role is to represent the interests of consumers of financial services.

MPPI withdrawal clause scrapped has scrapped a clause which allowed it to withdraw cover at 30 days’ notice from its mortgage payment protection insurance products.


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