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Boulger slams Skipton on introduction charge

Charcol senior technical manager Ray Boulger Skipton Building Society&#39s interest rate increase for introduced business is unacceptable.

Boulger has criticised Skipton for placing a 0.25 per cent surcharge for introduced business on its new base rate tracker mortgage.

The mortgage charges borrowers who approach it directly bank base rate plus 0.24 per cent for four years. Introduced business is charged bank base rate plus 0.49 per cent for four years.

Boulger says this is not a very mutual way of doing business as borrowers on the introduced rate end up paying an extra 1 per cent over four years.

He says: “Over the four-year tracker period, anyone on the introduced rate will pay an extra 1 per cent in interest. This does not seem a very mutual way to treat borrowers who choose to get independent advice rather than go direct to a lender.”

Skipton head of product development Martyn Bell says: “When we take into account the cost of originating introduced business as well as the benefit of income from additional sales on direct business through our branches, we then decide whether there is a need to price additional margin on the introduced product range. In this case, we chose to add in a differential.”

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