TSB will drop early repayment charges for customers who wish to move to another lender in specific cases, Mortgage Strategy has learnt.
A rumour began after requests for mortgage advances were turned down, prompting TSB to hint that it was considering waiving the charges if clients wished to leave.
Further probing by Mortgage Strategy revealed that customers whose product is about to mature – and so face being put onto a standard variable rate mortgage – were not able to switch to a new product within TSB’s own suite, and may also be offered a money saving deal.
The bank’s struggles with its IT infrastructure has been a mainstay in the headlines since April.
The switch to the new ‘Mortgage Pro’ system, which was brought in to halve the time it takes to make a mortgage decision is online, but data migration issues appear to be the reason for mortgage advance and product transfer requests functionality being temporarily turned off.
On contacting TSB, the bank says: “We would like to apologise for the delay in turning our mortgage product transfer capability back on. We know how frustrating this must be but we would like to reassure our customers we are working as hard as we can to reinstate this, and no customer will be left out of pocket as a result.”
TSB also offer the following clarification: “Where an existing customer wants to move to a new mortgage product with TSB but we cannot fulfill their product transfer needs at this point in time, we will fully refund the difference in interest charges between our standard variable rate or homeowner variable rate (that they will move onto temporarily) and the fixed rate they could have otherwise secured until we can complete the product transfer.
“We also appreciate that some customers may not want to wait. Our advisers can talk them through alternative options available to help meet their borrowing needs (for example via a broker) and we will support customers if they want to move to another provider, for example, waiving applicable early repayment charges.
“We recommend that any customers who may be impacted by the temporary withdrawal of product transfers get in touch with us as soon as possible.”
Libra Financial Planning financial consultant Sebastian Riemann says: “The lender has tried to replace an old and out-dated system with their new software and have been the first of the major lender to do so in quite some time.
“Most other IT ‘upgrades’ have been bolt-ons and revamps of existing platforms which often are simply a partial improvement rather than a full solution. It is very unfortunate, as the lender itself has been great both for clients and brokers alike, and have one of the most client-centric approaches in the entire industry. I am sure they will resolve their issues and will be a lot stronger at the end of the process. Comparing it to other lenders that still re-key each individual application by hand from one system to another they are quite some way ahead.”