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Are last minute mortgage product pulls disrupting business?

Journalist: Shekina Tuahene, Mortgage Solutions

ended 16. May 2023

Hi all,

This is for a Mortgage Solutions feature.

I've noticed a couple of lenders announce rate changes, with deadlines a few hours later and wondered how this was impacting business if at all.

Although the market is settled now, is this causing disruption? Have you noticed this becoming common again? What impact is it having on your business, if any?

4 responses from the Newspage community

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Editor
Riz Malik
Independent Financial Adviser at R3 Wealth
It appears that this trend is resurfacing after it calmed following the disastrous mini-budget and ensuing turmoil. It is important to note that products being withdrawn with abbreviated deadlines can significantly elevate stress levels amongst brokers, a situation that's only exacerbated by the ongoing volatility of interest rates. I'm still questioning why we can't adopt a more manageable approach, such as Coventry's 48-hour notice period, to provide a reasonable timeframe for adjustment to new pricing.
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Justin Moy
Managing Director at EHF Mortgages
This has always been a feature of the majority of mortgage lenders, just don't have any appointments in the afternoon as you may miss an important rate change and the cut off could be as early as 2pm. This does create an environment that is not ideal for anyone, as Brokers will need react to this and clients may feel panicked into taking a deal, certainly not the experience you would promote for the most important purchase in your life. We all appreciate that market conditions are changing constantly, but some lenders like Coventry BS and Platform are able to let us know with at least 24-48 hours notice, so why doesn;t the rest of the market do the same? This impulse rate changing marlarke just creates a difficult work environment for us Brokers, and we then struggle to properly support our clients.
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
Anything last minute is always disruptive, when it's a lender pulling an interest rate and replacing it with a higher one, it is even more so. The pressure is suddenly on to get any pending applications submitted before the cut-off; and all other plans, work and private, get dropped to make sure that happens. They'll be many brokers up and down the land who will have canceled family dinners, date-night, or been unable to watch their children's events because a lender chose to pull a rate at 4pm and gave us all until 6pm to get applications submitted.
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Gary Bush
Financial Adviser at MortgageShop.com
How to make a bad situation worse, well if you run a large UK lending institution just give the market a couple of hours notice before pulling a mortgage rate from market. These lenders show absolutely no care to the advice firms who are recommending their products to clients, have submitted initial data to them and had the case agreed in principle, are 2/3's the way through submitting a full application bundle to the lender when they hit a data snag are awaiting applicant response to allow them to finalise the procedure and reserve the rate. Why should lenders care you ask yourself, well I personally would hope that the FCA's Consumer Duty might have something to say about this awful process from August onwards that the industry suffers from. I live in hope.