Mortgage brokers are calling on lenders to give a minimum of 24 hours notice before pulling home loan rates.It comes as TSB has today given less than
Mortgage brokers are calling on lenders to give a minimum of 24 hours notice before pulling home loan rates.
It comes as TSB has today given less than four hours notice before discontinuing a selection of its mortgage products.
TSB notified lenders at lunchtime it was withdrawing all of its two, three and five-year fixed rate house purchase and remortgage products which come with a £995 fee.
TSB also said it was axing several of its two-year fixed rate buy-to-let loans.
Brokers want lenders to commit to giving at least 24 hours notice before changing their mortgage products.
Other lenders including HSBC have pulled rates at equally short-notice leaving customers who don’t have time to submit a full application facing even higher interest rates.
Katy Eatenton, mortgage specialist at Lifetime Wealth Management, said: ‘Words fail me. This is not an email well received at lunchtime on a Monday.
‘Three hours’ notice of rate withdrawals isn’t considering the client or the adviser. This is the fourth time TSB have done this in less than two weeks.’
Lenders are scrambling to reprice mortgage deals as financial markets bet on further Bank of England rate increases to tackle inflation.
Today the average two-year fixed rate went above 6 per cent for the first time this year, to 6.01 per cent, according to Moneyfacts. This is up from 5.98 per cent on Friday.
The Bank of England is now widely expected to hike the rate by 0.25 percentage points to 4.75 per cent when its Monetary Policy Committee meets on Thursday
This rise is no longer seen as the last and the Bank is forecast to keep raising base rate this year, with the most hawkish economists and market commentators seeing it peaking as high as 5.5 to 6 per cent.
In response swap rates – the main mechanism lenders use to set their fixed rates – have increased and this is feeding through to mortgage pricing.
Rohit Kohli, operations director at The Mortgage Stop, said: ‘Surprisingly, TSB has done this again.
‘Questions need to be asked of their leadership and approach to pricing their products if they are having to react this way so frequently — this is the fourth change in just two weeks.
‘This is what the regulator should be looking at to protect the consumer.’
Michelle Lawson, director and mortgage adviser at Lawson Financial, said: ‘Lenders are just going to be forced in withdrawing completely until the inflation announcement on the 21 June and the subsequent Bank of England rate decision on Thursday.
‘This is a dire time for anyone wanting a mortgage currently and actually for all in the industry.
‘Somebody needs to step in sooner rather than later and get this disastrous mess on a better path.’
Last week, a group of brokers launched a representative body The Broker Collective – and it is calling on lenders to give at least 24 hours notice before pulling deals.
Riz Malik, a member of the new body, said: ‘We want lenders to commit to a minimum notice period of 24 hours to all affiliated brokers.
‘We understand the issues caused by the sudden withdrawal of products, especially in a volatile financial market, which can induce anxiety and stress for brokers who are critical partners in our industry.’
In addition the group has asked lenders ‘to commit to clear, concise and open communication channels’ and commit to working with brokers to ‘minimise disruption’.
TSB has been contacted for comment.