Abbey ditches proc fees for interest-only ports

Abbey for Intermediaries will no longer pay a proc fee to brokers for borrowers who port their interest-only mortgage over 50% LTV.

Earlier this month Santander reduced its maximum LTV for interest-only mortgages from 75% to 50% for new borrowers.

But it is currently allowing existing Abbey mortgage customers who have any part of their existing loan on an interest-only basis to port their product to a new property.

It will allow borrowers who have an LTV of between 50-75% to port their mortgage as long as they want to borrow the same amount or less.

Abbey however says borrowers will need to contact the lender direct for the deal and brokers will no longer receive a proc fee.

It will however continue to pay proc fees on all interest-only cases ported below 50% LTV.

Where a customer wishes to port their existing product and borrow more on their new property and the new LTV will be above 50%, brokers can process these applications in the normal way on a capital and interest basis and will receive a proc fee on the total mortgage loan as usual.