Possible to negotiate mortgage rate with lenders?

Mushy

Having been inspired by the Apprentice the other night I started thinking abut whether it would be possible to negotiate the advertised lending rate with lenders.

So say for example I phoned up First Direct and offered to take out one of their mortgage products but at a slightly reduced rate then what's they're advertising. Would I just be laughed at or is it possible to get a better deal this way?

Debt_Free_Chick

You would simply speak to a call centre operative, who does not have the authority to negotiate.

Sorry

Imelda

Hi Mushy,
You probably won't be able to negotiate the rate but I managed to get my bank (HSBC- sister co of First Direct) to give me a credit card on 0% for 9 months and a £1,000 interest free overdraft for a year. I already banked with them so maybe that helped. Also face to face in a branch rather than over the phone might work better.
I'm interested to hear how you go (I never like to pay full price for anything and love hearing how people negotiate themselves a better deal).
Immy

sandydog_2

I remember when you could communicate with bank managers who had some authority to give deals, but it just doesn't seem to be an option these days.

TangentMan

The big lenders are shifting hundreds of thousands of mortgages a year. Therefore not only can their operatives not negotiate a rate, it simply isn't in the big lender's interests to burn the money negotiating a reduction in their profits (because, lets be honest you aren't going to be pushing for a higher rate!).

However if you go to a smaller lender, say a local BS or a private bank then they are likely to be interested.

Continuing your Apprentice motivation and remember the selling to the trade task (i.e. the petrol cans) "you are not going to negotiate a good deal with a multinational - think local shop".


The exception would be if you wanted to borrow a large sum of money. Lets say over a £2m, then you might get the attention of a big player.

dwsjarcmcd

The answer is no, irrespective of who the lender is. This primarily because the lender would need to
- create a bespoke KFI (systems resource needed)
- create a bespoke cost for comparison (systems and finance needed)
- create an bespoke administration process (systems/admin/finance)
- etc

It is not as simple as agreeing an under the table deal regretfully

MortgageMamma

I think I read somewhere in one of the mortgage magazines earlier this year that a group of lenders were going to trial a web based mortgage bidding service. I think what is going to happen is that customers looking for a specific product would register their interest and once there was a sufficient number of customers negotiations would begin with the lender. I dont know if this ever actually happened or not but I've not heard/read anyting since. I've racked my brains trying to think what this was called and even searched back issue of the mag on internet, but cant find anything relating to it now



MM

HelpWhereIcan

MM

I presume you are talking about something other than mortgagebundles.com who have been less than successful in their intentions as lenders have just been coming back and offering their standard range (AFAIK) and when I say 'lenders', I mean 'mainly Nationwide'.

Or am I just being unkind to a good but seemingly poorly thought out idea? Afterall, it may still take off in the way they wanted it to.

MortgageMamma

Yep it was mortgagebundles. couldnt remember for the life off me last night qhat it was called had rather lot of wine.

I've not heard or read anything about mortgagebundles other than the original article so im not really in a position to comment about how its doing. I will look at it though just out of interest and because im really sad!

Doubt it will ever become the ebay of mortgages though lol.

MM

Mushy

With nothing to lose I gave this a go this morning with First Direct and after being put through to one of their mortage advisers the converstion went like this:

Me: Hi, I'm interested in your offset mortgage. I see on your website that the current rate for that is 5.7%. If I decided to go with your offset mortgage today would you be able to offer that at 5.5% ***waits anxiously***

FD: Um, I'm afraid we're not able to offer you a lower rate than what were currently offering...


oh well, thanks for everyone's input. I'll just keep looking around for now.

Mushy

herbiesjp

You could always look at flexible mortgages which may have the same effect you are looking for, if you are spefically looking at offseting a savings balance