Dual pricing tips in favour of brokers
Santander is currently offering its lowest fixed rate exclusively to intermediaries through its AFI arm.
A spokesperson for Santander said: “As a multi-channel business, there will be times when our products will vary across channels and we are delighted to be able to support the intermediary channel with this fantastic rate which is available to over 95% of the market through our Key Account partners.”
The lowest 2-year fixed rate on offer in the branches at 60% LTV is available up to 70% LTV with a rate of 2.99%.
The lender added: “This market leading intermediary exclusive has been very popular with brokers and their clients, and we’re also delighted to support the market with great service and an average time to offer of just nine days.”
Robert Sinclair, chief executive of the Association of Mortgage Intermediaries, said: “AMI has long said that there would come a stage when dual pricing tipped back in favour of the broker community.
“Although this is an isolated case, we clearly welcome the support provided by a major lender.”
Kevin Paterson, sales and marketing director at Assurant Solutions, viewed the move as a commercial decision to drive up volumes.
He said: “It is probably because they have not lent enough money in the first half of the year.
“Distribution fees to the broker channel and branches are not dissimilar so they must be looking to increase distribution using the most immediate channel, the broker.”
Paterson did not think that the initiative by AFI would lead to other big lenders following suit.
He said: “You are not going to get a price war when you have effectively got a cartel.”
Lowering the rate was the right move to increase lending volume in the quickest way, said Paterson.
And he added that “brokers are like a swarm of bees” – as soon as a rate is dropped they will switch their business to that lender until the rate is withdrawn.