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Dealing with the madness of unexpected removal of products

Journalist: Jake Carter, Mortgage Introducer

ended 14. June 2023

How are brokers dealing with the madness of lenders pulling products with little notice?

What situations have you faced over the last few weeks?

How have you been getting deals over the line?

How is this impacting the market?

8 responses from the Newspage community

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Michelle Lawson
Director at Lawson Financial
I have had various situations where my customers have had to make rushed decisions or have to take a higher rate. In some situations they are parting with booking fees and valuation fees, which are often non-refundable. I have also had a couple of lenders who have pulled products and failed to tell us. The problem with short notice withdrawals is this puts immense pressure on us, as brokers, to submit an application accurately and also to provide the appropriate documentation. Thankfully I get all documentation upfront before I embark on research and recommendation, however I can only focus on one at a time as by the time I have recommended a product and communicated this to my customers, the product could be pulled and I would have to start from scratch. Also, we aren't just dealing with one application at any one time so I have had situations in the past few weeks where multiple lenders were on a short-term withdrawal notice and I have had to prioritise the already prioritised.
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Ross Lacey
Director & Independent Financial Adviser at Fairview Financial Management
We are being honest with clients about the fact that we could recommend a mortgage this morning, and by this afternoon it's no longer available. It's therefore key we're organised and have everything ready to submit full applications quickly once clients give us the go-ahead, and also that clients understand they need to move quickly to secure deals.
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Emma Jones
Managing Director at Whenthebanksaysno.co.uk
Keep calm and carry on! The last few months we have become used to these changes now, we notify every client that what we quote may likely change if we don’t submit a formal application as soon as they decide to proceed. This way no one is let down. The rates will be back, it’s always a matter of time.
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Aaron Strutt
Product and Communications Director at Trinity Financial
The scale of rate hikes has been pretty relentless over the last few weeks. After getting through the pandemic and the mini-budget, most brokers really were not expecting we would have to deal with this mess again. There is no doubt that the Bank of England base rate hikes are starting to cause real issues and there are even more stories of people's mortgages going up by thousands of pounds a month because they have just remortgaged. Even time the base rate goes up more confidence is sapped from the property and mortgage markets not to mention the wider economy. We need a period of financial stability soon.
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Steven Morris
Advising Director at Advantage Financial Solutions
Lenders are repricing with little to no notice, most likely because inflationary reports in the U.S of A have indicated inflation won't be transitory, it may well hang around for a while. If you look at the pricing of 2 year fixes vs 5 year fixes prior there was perhaps a clue that lenders assumed inflation and rates would normalise in 2 years time. With this news coming in, lenders have had to change tact quick sharp. Therefore so have brokers. This is part of our job, unfortunately. We have been getting deals over the line the old-fashioned way, panicking and keying applications as quickly as humanly possible before deadlines. I have had umpteen clients come out of the woodwork who were 'waiting' for rates to reduce, now desperate to go ahead given the new outlook. I also can't understand some brokers online saying 'don't believe the negative media' whilst watching rates go up by nearly 1%. Maybe this is all a temporary bump, but it's certainly not positive. Soz.
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Austyn Johnson
Founder at Mortgages For Actors
You have to roll with it. Keep your clients informed and if you can get it in before the deadline, great. If not, you need to talk to the client and then re-research. You cant let yourself get all in a fuddle just because someone took something away. Deal with the now, dont cry about the was.
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James Vince
Managing Director at Castle View Finance
The world of uncertainty is never welcomed in any industry. We have seen a two to three weeks shift 'again' as lenders reposition themselves for long-term banking and finance strategies as like any business they need to return a margin within the banking world.

The pain is felt by the clients that have already formed a budget for purchase or those coming out of a product that has been lucky to have been on exceptionally low rates and now face a 3 or 4-times increase for the same £ for £ lending.

With product pulls, we always see the one with consideration that gives the market time to protect and treat the clients fairly, against the knee-jerk reaction of less considerate lenders who give hours to submit a full mortgage application.
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Scott Aitken
Director | Mortgage & Protection Broker at Aitken Financial Services
I have no issue with lenders pulling products or amending rates to keep up with market conditions however, there needs to be a mandatory minimum notice period they give to Mortgage Advisers.

If Coventry Building Society can give us 48 hours, when can other high-street banks barely manage 1 hour?

You would think that the incredibly short notice some lenders are providing cannot meet the products and services area of Consumer Duty. It certainly will not get them goodwill from consumers or intermediaries as it has resulted in several late nights chasing clients for documents in order to get cases over the line and secure a rate.