The Leeds building society have put rates up!

devon_guy

I've seen it all now. In a market of falling rates the leeds have decided to put their rates UP with effect from 2nd Jan. I'm speechless. Hope I complete before Feb so I can be on the old rate.

feisty1

just probably trying to keep the mortgage book to a minimum

dwsjarcmcd

It depends on what has happened to swap rates, if they have moved up, then lenders will follow.

David

opinions4u

It can be a tough job for a building society (or bank) to balance the needs of their savers and borrowers.

Personally I think the move you describe suggests funding pressure and a need to increase savings balances / reduce mortgage balances.

Watch this space, but I predict their independence is likely to disappear over the next few weeks.

If you're able to remortgage, give it strong consideration.

feisty1

i second opinions4u, by offering higher rates they are minimising the mortgage book

dunstonh

If you dont want business or want to reduce business, you put your prices up. Every business does that. Mortgages are no different. They are retail products with a cost.

Charlton_King

dunstonh wrote: »

If you dont want business or want to reduce business, you put your prices up. Every business does that. Mortgages are no different. They are retail products with a cost.

Excuse me but no. This is brokerspeak.

Money is a 'product' like no other, as we have all seen over the last few months. So far from being a 'product' money is, and always has been, the medium of exchange. The product you are getting is the roof over your head. The mortgage is the means to that end.

Go on, tell me that there are no possible ways for a lender to reduce 'sales' of its mortgage 'products' other than putting up their 'prices' - their rates.

They couldn't, for example, simply withdraw them or limit their availability, could they? Heavens above, no...

Let's be honest, the barrow boy analogy can be taken too far...

inca_2

I don't understand what annoyed you so much about Dunstonh's post. It was perfectly correct. The only way really that a mortgage company can limit availability is by restricting their lending criteria which means that customers will waste their time going through an interview only to be told they cannot go any further. Surely it's better for the society to put the rates up and therefore put people off from applying in the first place. If they need to reduce their mortgage book then they need to reduce it simple as that, no point getting wound up by it just go to someone else surely? Mortgages are a retail product, you pay the cost that the lender sets, as with anything else, if you don't like the cost then you don't buy from them?

bristolleedsfan

feisty1 wrote: »

i second opinions4u, by offering higher rates they are minimising the mortgage book

http://www.moneyexpert.com/News/Article.aspx?articleID=18950042&productTypeID=23


Leeds Building Society has announced it is to reduce prices on the majority of its mortgages as part of a New Year sale.

The range of discounts covers several fixed-rate, offset, first-time buyer and buy-to-let mortgages, the firm revealed.

General manager of marketing and customer services Karen Wint said that the deals offer first-time home purchasers, as well as those looking to remortgage, with "peace of mind and flexibility".

She noted that despite the credit crunch, it is "business as usual" for the company as it is a building society and not a bank, many of which have had to apply for government support.

Rates on the newly-reduced of homeowner loans start at 4.75 per cent over three years.

Ms Wint remarked: "The New Year is a great time to sort out your finances and it's mortgage sale time at Leeds Building Society. I would urge customers to act quickly."

It comes after NatWest and Royal Bank of Scotland unveiled deals on fixed-rate mortgages.

dunstonh

Excuse me but no. This is brokerspeak.

Im an IFA not a mortgage broker so I wouldnt know what brokerspeak is.

However, financial services products are retail products. They are bought and sold. They have prices and cost. Providers alter terms frequently to encourage and discourage new business. They also cross subsidise at times and run loss leaders. What advisers (mortgage or investment) do is known as retail financial services.

Go on, tell me that there are no possible ways for a lender to reduce 'sales' of its mortgage 'products' other than putting up their 'prices' - their rates.

There are lots of ways to do it but the best one for them is to put the price up. It improves profitability, reduces costs and achieves their aims.