MSE News: Beware mortgage lenders' hard-sell rate trap

Former_MSE_Guy

This is the discussion thread for the following MSE News Story:

"Homeowners approaching the end of an introductory mortgage deal have been warned to beware lenders' hard-sell attempts to flog them a new product ..."

Read the full story:
Beware mortgage lenders' hard-sell rate trap

VIGILANT22

Thanks for the article..

Gorgeous_George

All markets need some people to be less savvy and pay more so that others can benefit from better deals.

For example, a car dealership may need to sell 10 x cars at £10K each in a month. If they can sell 9 of them for £10,100 to 'richer' customers they can discount the final one by £900 for a better haggler.

What astounds me is that people borrow many times their annual income and don't know the key facts of the deal.

Nationwide, like other lenders, need to balance the books. Their BMR is too competitive (it was never expected to fall to 2.5%) and if they are to avoid going out of business they need to get as many people as possible off the BMR deals. Alternatively, they may be forced to change the terms of the mortgages for everybody and that wouldn't be popular.

I'm not saying that they should con people but I don't blame them for targeting new deals to those who they would like to move. After all, Honda don't send me a flyer offering the latest Honda Accord with a note saying that keeping my old Honda Civic is cheaper.

We, as customers, need to take responsibility for our own decisions. If we all wish to pay the fair price there will be no room for anyone to gain a bargain.

GG

VIGILANT22

I guess this is the benefit if you have an adviser as they're obliged to discuss all your options

Chrismaths

She didn't know the base rate was 0.5%?! She shouldn't be allowed any kind of mortgage!

michaels

Do we really need to be warned that we should look for the best deal when spending 7k plus pa?

Thrugelmir

MSE_Guy wrote: »

This is the discussion thread for the following MSE News Story:

"Homeowners approaching the end of an introductory mortgage deal have been warned to beware lenders' hard-sell attempts to flog them a new product ..."

Read the full story:
Beware mortgage lenders' hard-sell rate trap

The article's title is somewhat misleading. As hardly a hard sell. :rolleyes:

wizk1

Thrugelmir wrote: »

The article's title is somewhat misleading. As hardly a hard sell. :rolleyes:

"You need to begin the switching process one month before your existing rate expires."

That sounds like hard-sell talk to me.

nomoneytoday

It's not Nationwide's job to do all the research for customers.
They are a business, all be it a Mutual Society rather than a plc, not a charity

VIGILANT22

wizk1 wrote: »

"You need to begin the switching process one month before your existing rate expires."

That sounds like hard-sell talk to me.

It is the process if you want to go onto a new rate the following month once your old one expires.

Charterhouse

It's a tough situation. They have really suffered from the extended period of low rates and the changes in the funding environment since they entered into the SVR=BR+2% promise. They need to get as many people off that SVR as possible. Personally, I'd rather have a fixed rate at say 3.79% than be on the SVR at even BR+2%, so if I was with Nationwide on one of these, I'd ask what the VERY best they can do is to get me off the old deal.

The point is, it doesn't say what the deal was. If the new one was a fixed rate, this isn't necessarily a scam at all. There's not enough information, the only thing that's sure from the article is that the woman in question is a retard.