Coventry for Intermediaries will pull selected residential and landlord fixed-rate products for new customers tomorrow, coming back to market with higher rates on Wednesday.
The mutual’s broker arm says it will withdraw loans at 8pm on 18 July and will launch new offers at 8am on 19 July, in line with its commitment to give brokers two days’ notice of product closures.
The changes include:
Residential – new business
Buy to let – new business
The move comes ahead of June inflation data to be released by the Office for National Statistics on Wednesday.
When the current 8.7% figure for the 12 months to May was released last month. It sparked the latest round of rate rises from mortgage lenders as money markets bet that the cost of living would remain high, forcing the Bank of England to continue pushing up interest rates, currently at 5%.
Large Mortgage Loans founder and chief executive Paul Welch says: “A worrying sign of what’s to come is the notice of product withdrawals from some lenders, indicating that they’re bracing for impact on Wednesday when inflation data is announced.
“If core inflation figures continue their upward trend, money markets will react, driving up swap rates.
“What does this mean for homeowners? Another surge in fixed-rate mortgages, potentially spiking into the 7.5% realm.
“Money markets perceive the UK economy as volatile, and until we tame inflation, mortgage borrowers will continue to bear the brunt of this financial storm.”
Coventry for Intermediaries warns brokers that an agreement in principle “does not secure a closing product”.
It adds: “If an agreement in principle refers, we can’t guarantee we’ll be able to review it before the product is closed.
“If your agreement in principle does refer, you should copy the case and click through to the full mortgage application to secure the product. Applications received after 8pm Tuesday 18 July will not be accepted.”
The unit adds that online product transfer cases should be fully submitted by 8pm on 18 July.
It says that paper product transfer application packs already provided should be fully completed, signed by all applicants, and returned by 8pm on 18 July.
The firm adds that pending product transfer paper application packs and requests received between today and 8pm on 18 July should be fully completed, signed by all applicants, and returned within 48 hours of the date of illustration.
