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Why offer different rates to new customers ?
tonydee
Posts: 722 Forumite
I'm still doing to research into a mortgage deal as mine expires in August.
I'm bewildered by the big differences in interest rates for existing customers and new customers ???
Are the lenders banking (excuse the pun) on borrowers not re-mortgaging and going back to variable rate once their offer has expired ?
Currently with Abbey but not too happy with some of their quotes at present !
I'm bewildered by the big differences in interest rates for existing customers and new customers ???
Are the lenders banking (excuse the pun) on borrowers not re-mortgaging and going back to variable rate once their offer has expired ?
Currently with Abbey but not too happy with some of their quotes at present !
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Comments
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tonydee wrote:I'm still doing to research into a mortgage deal as mine expires in August.
I'm bewildered by the big differences in interest rates for existing customers and new customers ???
Are the lenders banking (excuse the pun) on borrowers not re-mortgaging and going back to variable rate once their offer has expired ?
Currently with Abbey but not too happy with some of their quotes at present !
It's a purely commercial decision by the lenders hoping that the "retention" products offered will be enough to keep their "customer". They reply on consumer apathy and the fact that remortgaging is perceived to be complicated so the client goes for the retention product.
Unless you loan is small, or in the later years of a repayment mortgage then the remortgage should be your best option.
Take advice
SSI am a fee charging WoM Mortgage broker.I now no longer give information and opinion within the Mortgage boards, because a number of posters who, having approached me professionally, agreed my fee-which has been been made very clear at the outset, taken my advice (normally cancelling a [home visit] meeting at short notice) have then approached one of the fee-free brokers on here to arrange the very same deal I have advised.Whilst I totally concur with the ethos of "money saving"- abusing the goodwill of a professional who provides a quality service is taking it too far! :mad:0 -
stanmoresaver/ wrote:
Unless you loan is small, or in the later years of a repayment mortgage then the remortgage should be your best option.
Take advice
SS
It would certianly seem that way. Thanks SS0 -
Not all lenders do offer different rates. Some have a policy of offering the same rates to all.0
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I think they rely on the inertia effect, there are still lots of people happily paying their 25 year mortgage off at a stupid rate when the same lender is offering really good deals on remortgage or new mortgage.0
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