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Effect of withdrawing cheap lending on intrest rates
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AFAIK HSBC has never used FLS funding, so it won't be affected.
FLS only affected new borrowing, not existing customers, so anyone who already has a mortgage was not/ won't be affected.
When FLS funding runs out, lenders will have to return to more traditional lines of funding, but this will mean a return to more normal margins and the competetive nature of the market should not mean vastly higher rates for new products.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
kingstreet wrote: »the competetive nature of the market should not mean vastly higher rates for new products.
Agreed.
FLS was a policy response to overcome a temporary shortage of funding in the market.
As the funding situation has now improved, it can be withdrawn without much in the way of adverse effects.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0
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