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Abbey ditches proc fees for interest-only ports

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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.

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Readers' comments (6)

  • By definition these customers really need advice so it is bizarre and disappointing that Abbey would deliberately seek to chop the intermediary out of the process in this way.

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  • It is clear that they want to get their ducks in a row with respect to the transitional arrangements in the MMR, but there really is no justification whatsover for not paying us just because the mortgage is interest only...

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  • You or Abbey don't appear to say if a customer with existing interest only wants to port and top up what the proc fee scenarios are either assuming the port is kept on interest only, or the whole is accepted on interest only.

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  • Abbey have a habit of trying to cut intermediaries out of proc fees and trying to keep the customer to themselves whilst saying that they support the intermediary market.

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  • Typical Abbey kicking the mortgage brokers while their down, brokers have supported them for years but they kick us in the teeth at every opportunity.

    This is on top of their little trick they have come up with cutting us out of remortgage opportunity with their customers by contacting them up to 6 months before a deal is coming to and end and tying them in.

    I will of course avoid them at every opportunity from now on.

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  • Isnt it about time that Santander- held up their hands and told the market- when it will be withdrawing from the intermediary market place. This must be factored onto their plans going forwards. Come on Santander:- We challenge you to provide a honest response here.

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