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"A Barclays increase after a TSB decrease is mind-boggling"

Journalist: Justin Moy, Contributing Editor

ended 23. May 2024

Barclays has just announced significant increases across a wide range of their purchase and remortgage deals, at the same time that other lenders seem to be going in the opposite direction. Many of the lender's mortgage deals are increasing by around 0.25% (see screengrab below). Newspage asked brokers for their reaction to this move by Barclays this morning. One said: “A Barclays increase after a TSB decrease is mind-boggling. This move can only be to stem the flow of business. It begs the question, is it right for borrowers to pay more because lenders can't handle volume? The industry isn't as busy as it has been so this is an odd move.” For more views, see bottom.

 

12 responses from the Newspage community

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Editor
Justin Moy
Managing Director at EHF Mortgages
This is an odd move by one of the major lenders, considering other mainstream lenders have been reducing rates over the past few days. With a total swing of 0.65% between the equivalent TSB and Barclays products, this shows how lenders price on many factors, not just the cost of funds, and that borrowers do need to use a broker to keep on top of these significant price variations. It won't surprise me if Barclays launch a corrective set of new deals next week.
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Michelle Lawson
Director at Lawson Financial
A Barclays increase after a TSB decrease is mind-boggling. This move can only be to stem the flow of business. It begs the question, is it right for borrowers to pay more because lenders can't handle volume? The industry isn't as busy as it has been so this is an odd move.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
Some lenders seem to make decisions in a vacuum. It is no wonder that potential buyers are in two minds as to buy or wait when lenders themselves cannot even agree on the direction of travel.
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Rob Gill
Managing Director at Altura Mortgage Finance
These rate hikes from Barclays are no surprise after yesterday's disappointing inflation figure. The surprise is that other lenders cut rates just hours after interest rate markets slashed the chance of a June base rate cut. Borrowers and brokers alike will watch closely to see how this tug-of-war plays out.
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Dariusz Karpowicz
Director at Albion Financial Advice
This is a surprising, if not bizarre move from Barclays, and doesn't follow the recent trend. Perhaps Barclays has already met their quotas for this quarter? While other lenders are cutting rates, Barclays' decision to hike their purchase and remortgage deals by around 0.25% will leave brokers scratching their heads. It's a curious twist in the current market dynamics, and it certainly adds a new layer of unpredictability to the mortgage landscape. Let's hope this is just a temporary blip and not a sign of things to come.
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Ross Lacey
Director & Independent Financial Adviser at Fairview Financial Management
Barclays have been sourcing very competitively so this may be a short-term move to reduce business flows.

We'd hope given the direction of travel to see further rate cuts from other lenders and for a u-turn on this from Barclays in the coming weeks though!
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Simon Bridgland
Director at Charwin Private Clients
The paltry reduction offered from Barclays this morning is clearly aimed to attract their favoured, clean cut, cherry-picked client. Why they would choose to stick two fingers up at those looking to remortgage with Barclays and existing customers looking for a new deal is either short sighted or perhaps they are still trying to get their back office in order from the disaster that it seems to have been over the past year.
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Katy Eatenton
Mortgage & Protection Specialist at Eatenton Finance
Barclays will definitely be increasing rates to slow down work flow, as they are offering the lowest rates on the high street currently. However, this is not keeping in the spirit of consumer duty when borrowers are being punished because lenders don’t employ enough staff to service them.
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Jack Tutton
Director at SJ Mortgages
Barclays changes is no shock in my opinion, they reduced their rates significantly a week ago would have attracted a lot of new business. Coupling service levels and recent news impacting stability in the financial markets, it’s not surprising that they want to take a step back and see how things play out in the coming weeks.
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Elliott Culley
Director at Switch Mortgage Finance
As predicted some mortgage lenders will increase rates of the back of the inflation data we saw yesterday. Although inflation came down, it was higher than projected and this has led to more turbulence in the market. Some lenders have recently decreased rates, but these decisions were likely made before the latest inflation figures. Barclays could be the first of many that make this decision over the next week or so.
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Benjamin Blyth
Director at Houz Mortgages
Barclays’ speed to underwrite and offer has been very poor for a good few weeks now. Slowing the flow of applications, which this probably is, is the right thing for them to do to improve their service levels.
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James Bull
Mortgage Broker at JB Mortgages
After the worse than expected inflation figures it is no surprise to see Barclays increase rates on their product range. The general consenses now seems to be towards rates staying fairly flat for the rest of the year now.