Accord penalising existing BTL clients with unfair product transfer rules

In 2021 the FCA investigated the 'loyalty' premium within housing and motor insurance and decided that the cost being passed onto existing clients was not fair, so why are lenders allowed to penalise their existing clients for their loyalty?

This move by Accord is outrageous. They have professed to abide by the mortgage charter but only for their residential borrowers. What is particulalry galling is the fact that if you're a new buy-to-let borrower you could benefit from any rate reductions but, as a loyal customer you are penalised and forced (14 days to accept your mortgage offer, up to 24 but with no guarantee on the rate), with no chance to change the rate and having to pay the ERC on redemption if you cancel the application altogether.

This is not treating customers fairly and poses unfair terms on existing clients, I do hope Accord will reconsider this policy and bring in line their BTL product transfer policy with the rest of their proposition.

It has been a well known fact that Accord implement the ERC early if a new buy to let rate has been reserved and not started by the client.

Brokers should be diligent to advise the client what could happen at the end of their initial chosen fixed term at the point of original advice to choose Accord.

Who knows the rationale behind Accord to stand by this, it may cost them a quick short term win by keeping that client on for an extra few years with as less admin as possible but at the risk of a disgruntled customer who will remember and likely move away as soon as they can.

Every lender has their own Product Transfer rules and now we are in a rate falling environment it's where the poor approach from some lenders really comes to the front. Nationwide are very similar across their residential products. They won't allow you to cancel your product transfer rate after the 20th of the month if it's due to start the 1st of the next month so I've got a client missing out on a 0.5% reduction in interest rate all because Nationwide decided to announce their rate reductions on the 23rd of the month when their new rate is due to start 1st Feb. Nothing can be done and the only response you get is "these are the rules"

This smacks of a serious Consumer Duty failing sadly from Accord, a division of Yorkshire Building society, a worrying unfair practice. It's surprising when Jeremy Duncombe, Director of Intermediary Distribution at Accord Mortgages has recently been quoted as saying "Accord is committed to supporting brokers to build the best relationships and get the best results." - the two don't match. I'd be interested in hearing a comment back from Jeremy on this subject or has he now forgotten his roots as a champion of financial advisers from his Legal & General days - "I'm all ears Jeremy".

It has come to my attention that Accord has reduced their product transfer rates. While this may seem like a positive development, there's a catch that greatly disadvantages existing buy-to-let (BTL) customers. It appears that once a client has signed the acceptance form, they are unable to change to a new rate. However, residential customers or those remortgaging to Accord have the flexibility to change the interest rate before completion.

This practice explicitly penalises existing BTL customers, leaving them at a disadvantage compared to other client segments. Given the current economic challenges, including high interest rates and a volatile cost of living crisis, such restrictions only add to the burden faced by mortgage borrowers.

It's crucial for financial institutions to consider the fairness and transparency of their policies, especially when they impact individuals navigating through challenging financial times. I believe it's important for Accord to revisit these policies

Simply put, very poor practice from Accord Mortgages. Marginilising buy to let clients does not look good and is grossly unfair, and I hope there will be backlash to get them to reconsider.

I am genuinely surprised by this morally unfair treatment of landlords by Accord, who usually are a go to lender for their flexibility. They are proud to advocate for their no nonsense underwriting but on this one they have completely missed the mark and will turn a lot of landlords off from using them in the future. I wouldn't be surprised to see a volume of BTL product transfer applications being cancelled and the business moved to a new lender.

Wow, thats a bit harsh... Other lenders are doing this and even some are charging a frr from £99-£499 but at leaast it gives you the opportunity. I cant see how Accord will be able to justify this for consumer duty. I like Accord, but they need to be sure they have a robust reason for not allowing the transfer. Its probably due to their funding model, but still, probably best to look into that!