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AMI warns lenders over direct deals

The Association of Mortgage Intermediaries has stated it has “major reservations” over the recent move by lenders in offering substantially better rates through their direct channels.

This comes after several mortgage brokers have expressed their growing concern this week over lenders’ treatment of the intermediary market.

Halifax, Nationwide and Cheltenham & Gloucester have come under fire for offering substantially better rates through their direct channel.

Halifax is offering a three-year fixed-rate homemover mortgage to direct customers at 5.74 per cent up to 75 per cent loan to value. It is available at 6.22 per cent through brokers.

The Mortgage Practitioner sole trader Danny Lovey wrote an open letter to AMI on Monday calling for the trade body to defend the intermediary market.

AMI director general Chris Cummings says the trade body fully recognises the seriousness of the current situation.

“We do have major reservations about the actions of certain lenders and the detrimental effect it is having on intermediaries and ultimately consumers.

“We have raised these issues with lenders directly and also in meetings with the representative bodies, CML and IMLA. We will continue to fight for a healthy intermediary market, which is best placed to serve the needs of consumers.”

Cummings has called on lenders to urgently return to a level playing field in terms of product pricing, recognising that consumers want access to mortgage advice.

“Products should be priced to respond to this demand, bringing an end to the artificial barriers to the access of advice through measures such as raising rates on intermediary business.”

Comments (6)


What are these lenders seeking to achieve? It cannot be the saving in the pittance paid as a procuration fee, which makes mortgages a loss leader unless a fee is charged. No, the likelihood is the opportunity to get in first with the sale of insurance products, which advisers should use to reduce the need for charging a fee.

So, FSA, what do you think about this? Are you happy to see the choice of consumers threatened? A short walk from the mortgage being implied as dependent on the sale of protection products as used to happen in the past! Also, are you content to see professional, independent advice prejudiced?

The banks are up to their old tricks. Their sales have been far more likely to result in complaints than advisers, which indicates that their employees are less likely to be as thorough and as committed to the welfare of their customers.

Eric Knowles


Shouldn’t we (the intermediary community) be calling for a temporary cessation of “exclusives” via all channels in these turbulent times?
If I recommend a mortgage scheme to a Client, I expect them to check with the Lender (via their web site) that the terms and conditions are as I explained. Therefore when Nationwide, A&L, Principality, etc undercut “broker rates”, I have funded their distribution with my advice.

Steve Langrick Cert PFS Ashley Law

Lenders need to remember where the majority of their current mortgage book has come from. It has been intermediaries that have sold most of their mortgages and given them the profits and the business they have today.

We will get through this current financial crisis and when we do, intermediaries will remember the lenders who looked after and appreciated the hard work we do. We are up against incompetent staff and underwriters with most lenders daily, but that seems to go unrecognised by our regulators and the lenders themselves.

Business can be written not only on the best price, but also on customer service and meeting TCF so there are many reasons I could list not to use almost every lender for new business. The last thing lenders want to create is a ‘them and us’ scenario. Ultimately, the consumer would lose out and that is not what intermediaries want.

Kind Regards

Vinny Parker
Assured Financial Solutions UK Ltd


It is good that the AMI is trying to speak to lenders about dual pricing but what are these lenders actually going to do about this matter. No response has been printed by these lenders in any magazine, etc. Premier Mortgage Service plus Legal & General Mortgage Club have also stated they have discussed dual pricing with lenders but again nothing seems to being done to get back to a level playing field. The FSA states clients should contact a mortgage broker to discuss their options but then provides details on its best buy tables about products available directly from lenders which brokers cannot get access to? Lender BDM’s always want to visit your office when things are good but where are they now?

Douglas Shillinglaw
Mortgage manager
Clegg Gifford Private Clients


What kind of lame comment was that? The FSA should be investigating this under TCF and the office of fair trading too for that matter. It is deliberate market manipulation. What makes it worse is that the lenders are refusing to offer us any service. They need to be reminded of what happend to L&G a few years back when they said they were not working with IFAs any more…..and we all know what happened there although L&G strangely can’t remember a thing.
If this is something to do with separating advice from sales then they need to read the FSAs comment on it that we (advisers) cannot advise unless a KFI is produced.
Sometimes I wonder why we pay all these people.
But take note the advisers will still be here after this (yet another) deliberate attempt to usurp us.

Roddy McKenzie


I am surprised the Woolwich were not mentioned. I arranged a re-mortgage for friends last year – BBR + 0.17% for term with no early repayment charges – before the market went in to decline. Those friends approached me this year as they were moving home and wanted mortgage advice. I recommended that due to the competitiveness of their product they port their current loan and arrange the additional borrowing required on the best tracker available with no early repayment charge, in order that they could switch to a fix rate if they become more attractive. Only product available to me as an Intermediary was BBR + 1.99%, containing early repayment charges for 3 years. This seemed extortionately high and, out of interest, I visited the Woolwich website and found that an existing customer moving home could obtain BBR + 0.74%, with no early repayment charges, if they went direct. With a rate difference of 1.25% and no early repayment charges I thought there must be some mistake so telephoned Woolwich for clarification, who cheerfully confirmed the disparity between the direct and intermediary products and informed me that it was only fair (?) as over the last 10 years intermediaries had access to products with preferential rates which were not available to customers going direct. Maybe that was because we were giving them business which they would not have otherwise received! What do you think?

Karen Hayes

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