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If Santander’s BTL rent clause is a ‘non-issue’, why not remove it?

Regarding the story that Santander has come under fire for a clause in its contracts requiring landlords to raise rents to the maximum where possible, why does Santander think this clause has been misunderstood? I think it is perfectly understood – and there lies the problem.

Also, it is a poor attitude to take that, because a clause has been generally ignored for the past six years, it is not problematic.

If it is a non-issue, Santander should remove it and any other clauses that create a need for the owner to pay additional professional fees to a third party at Santander’s request. A letting agent letter should suffice.

Proc fee affair is more about clients ‘persuaded’ to take onward deals

Regarding your cover story on the need for more retention proc fee payments from lenders, I don’t think it’s the case that brokers are not ‘satisfied’; it seems a very simple system to me.

The lender encourages the client to revisit their broker for advice at the end of the deal. The broker will run through all options, including that of staying with the current lender. If this appears to be ‘best advice’ and the client is happy, then job done: the broker gets a retention fee, the lender can be satisfied the client has received ‘full advice’ and therefore will not launch a complaint at a later date, and everyone wins.

What is not acceptable is clients accepting onward deals without truly understanding the surrounding implications.

Already this year I have had a lady with two loan parts on separate deals with Halifax.

We had agreed when the first loan ended she would ‘roll’ on with ‘variable’ for three months because that was all she had left, until she was penalty free on the second part of the loan, and we would then review the whole balance.

Meanwhile she took a call from Halifax, which simply told her it could “reduce her payments” by £169 a month, and so she agreed. She’s now locked in on this deal for another two years and, when the other part of her loan ends, she’ll be forced to take another product with Halifax.

I’ve calculated that with the combined additional 0.4 per cent on each deal she will be around £1,400 out of pocket over the next two years.

Likewise a similar thing with Santander: a client, encouraged to take a new deal despite wanting to borrow an extra £40k for home improvements, was actually told by Santander to complete the rate switch first, and is now facing further advance rates well in excess of the rate payable on the rest of the mortgage, or hideous ‘secured loan’ options.

How is this good customer service? It surely costs these lenders far more to provide staff to deal with retention than it does to pay a fully advised broker a retention fee, so I really don’t understand why so many are so against the idea.
Samantha Cox, Whichers

January’s dip in house price growth is no cause for homeowners’ alarm

On the news from Nationwide that house-price growth fell in January to its weakest level in over a year, it’s fair to say that, as far as external influences are concerned, 2017 has already thrown up its fair share of curveballs, particularly across the pond.

But the ripple effects of these distant influences are unlikely to reach the UK property market unless you own a second home in high-end London. That said, this year we will probably see some form of knock-on effect from the turbulence of 2016 where price growth is concerned.

But this is likely to be in the form of a slower rate of escalation rather than a negative movement.

Despite this potential marginal slowdown, it is widely predicted that the market will remain robust throughout this year and prices will maintain their upward trend, which seems to be the case based on today’s numbers.

A new year and another increase in house prices will provide a positive outlook for UK homeowners, albeit perhaps less positive for those still struggling to buy.
Russell Quirk, eMoov



Santander under fire for pushing landlords to hike rents

Santander has come under fire for a clause in its buy-to-let mortgage contracts that asks the landlord to increase rents by “as much as can be reasonably achieved” whenever possible. Mortgage Strategy was contacted by a private landlord who had spotted the clause in her mortgage contract and was concerned about the effect this would […]


Market Watch: Carney is covering all the bases

Carney has upgraded his growth forecast and reversed his jobs outlook but has ‘ballooning’ household debt in his sights I am not sure I can bring myself to speak too much more about the new US president without going off on a 10,000-word rant, so I will merely give him a passing mention. All the […]


Carney: Interest rates could go either way

Bank of England governor Mark Carney has suggested an interest rate hike is more likely this year if wage growth outstrips expectations. Rates could go either way though, he says. Speaking to the press after yesterday’s launch of the Bank’s inflation report and monetary policy update, Carney said the Bank has assessed the resilience of the […]

Can UK companies satisfy global appetites?

By Mark Martin, Manager of Neptune UK Mid Cap Fund

Rapid economic and income growth is leading to a dramatic shift in diet towards protein products right around the globe. UK companies such as Genus, the world’s largest livestock breeder, are benefiting from this increasing demand. Mark Martin, manager of the Neptune UK Mid Cap Fund, discusses this investment theme.


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