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Dual pricing

Journalist: Anna Sagar, Mortgage Solutions / Specialist Lending Solutions

ended 14. June 2023

Interested in speaking to mortgage brokers about dual pricing and whether it is starting to creep back into the market. 

  • Are there any lenders offering dual pricing at the moment? 
  • Do you think more lenders could start to dual price? 
  • What impact would this have on the broker market/lender broker relationship?

5 responses from the Newspage community

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Justin Moy
Managing Director at EHF Mortgages
Dual pricing has always been a muted issue betwene lenders and brokers, especially when the broker originated the application in the first instance. Often when rates are challenged, this topic becomes contentious. I haven't seen many examples, there are some lenders who dip into the Direct channel with cheaper or different deals. Dealing directly with the lender is normally provided with a 'No Advice' service, so there is no discussion about the suitability of any given product. Simply put, the borrower chooses, and there is no comeback to the lender. Through a mortgage broker, there is always advice and an assessment of suitabilty, even on a Product Transfer. 99% of lenders will have the same rates direct or via a broker, so there should be no financial gain, only benefits. You would also lose any valuable FSCS protection, as there was probably no advice going direct to the lender.
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Darryl Dhoffer
Founder at The Mortgage Geezer
Fortunately, the dark arts in Dual Pricing in my opinion have not crept back in for 2023 - that said lenders have loan books to fill, so would not surprise me, if a few minor mainstream lenders have a nibble with clients directly, and refrain from blatantly advertising these rates mainstream. Lenders have been largely aggressive in retention rates so far and I see this trend continuing for the remainder of this year
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
Dual pricing often creeps in when there is a turbulent market, lenders with a high-cost branch network use it to try and keep employed staff busy. However, even the largest lenders get the bulk of their business from the broker channel, so it is biting the hand that feeds you. This that have journeyed down this path previously have found that there is a high cost to try and get back into brokers' good books; with them having to put out loss-leading market-leading rates for a sustained period to get brokers back on side.
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Gary Bush
Financial Adviser at MortgageShop.com
Dual pricing or Direct Preference Rates from mortgage lenders at the moment would be a foolish thing to undertake - with now 80%+ of all mortgage work being undertaken by financial advice firms on behalf of lenders they would literally be biting the hand that feeds them. I have heard a few stories of slightly advantageous terms being made available direct to applicants - we have no evidence of this though. What is a real nuisance is lenders not allowing the specialist financial advice firms to arrange transactions such as further advances, transfers of equity, and even some not allowing product transfers. When lenders do this we send a warning communication to clients that their lender is choosing to demonstrate how effective they are at administration for this particular transaction with a side warning issued of expect long delays sadly. Why lenders operate this ridiculous situation beggars belief, they trust the adviser community with the difficult initial mortgage transactions
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Austyn Johnson
Founder at Mortgages For Actors
Losing business to duel pricing is one of the most frustrating things, especially if you have spent a fair amount of time researching. This should be addressed and standard pricing should be adopted. Even better to maybe 0.1% off the rate of a broker introduces/puts in the PT