Sainsbury's Bank is believed to be pulling out of the mortgage market because of queries that have been raised over the portability of its fixed rates.
Money Marketing understands Sainsbury's Bank has had issues with the regulator over its fixed rates, which are supposed to be portable although questions have been raised over this aspect.
The bank says it has not yet made any decision on mortgages but as part of its strategy it continuously reviews all its products. Money Marketing understands that a decision to pull out of the market is imminent.
The fixed-rate mortgages on offer from Sainsbury's Bank are two-year fixed at 5.39 per cent for loans up to 90 per cent loan to value and a 5.6 per cent two-year fix up to 100 per cent LTV. Both mortgages have early repayment charges of six months gross interest if the loan is repaid in full or in part during the fixed period.
An industry source says: “Sainsbury's Bank is pulling out of the mortgage market because it has had some queries over the portability of its fixed rates.”
Chief executive Derek Bottom says: “Sainsbury's Bank continues to enjoy rapid growth and has recently launched new life and health insurance products. Part of our strategy is to continuously review all of our products. No decision has been made on mortgages or any other product and Sainsbury's Bank will not comment on speculation or leaked reports.”