For best deals, go direct claims HSBC
HSBC is claiming 81 per cent of the best buy mortgage deals were offered by direct mortgage lenders and not by mortgage intermediaries.
Its claim is based on research by Moneyfacts, which analysed the following four most popular mortgage categories – two-year and five-year fixed, two-year discounts and lifetime tracker - declaring the lowest direct mortgage was, on average, £210 a year less (0.14%) for a typical £150,000 mortgage.
However, many believe it is not as clear cut as the London-based bank is suggesting. Chief Operating Officer at Alexander Hall, Andy Pratt, believes the impact of higher LTVs has had a sizeable effect:
“It is accepted that, with the market as competitive as it is, direct lenders have attracted lower LTV business with good rates. There is no doubt that this would help give them the majority of business, although I don’t believe it is as high as 81 per cent.
“Once we get to the higher LTV deals on the market, I think that 81 per cent would drop significantly because the rate that a client can get will vary quite dramatically across lenders.
“Sometimes the deals that brokers have access to are more competitive compared to what is available-direct. In cases such as this, a broker is an invaluable source for customers looking to get the best deal on the market.”¹
HSBC claims may, on paper, seem rather damning to brokers. However, in the current financial climate, clients are not only requiring a cheap rate but a product that fits with their situation. This is where a broker can be priceless.
Content correct at time of publication