Tesco Bank is set to enter the intermediary mortgage market, in a move to take on the largest high street lenders.
The supermarket chain’s Edinburgh-based subsidiary has initially made its mortgage range available through London & Country mortgage brokers.
The new service, Tesco Mortgage Intermediaries, will be offered through a range of other brokers via Legal & General’s key account firms, including Nouveau Group, Mortgage Advice Bureau, John Charcol and Stonebridge.
The service includes a number of features to help brokers make the transaction as straightforward as possible, including searchable lending criteria, webchat, and the ability to scan and upload documents and track the status of applications from any device.
Brokers will be able to contact Tesco Intermediaries by phone or online using the bank’s webchat functionality.
Benny Higgins, chief executive of Tesco Bank, said broker market competition has increased since the introduction of the Mortgage Market Review in 2014.
“The vast majority of Tesco customers select their mortgage through a broker and our platform has been specifically designed to help brokers provide a great service to customers remortgaging or purchasing their home,” he stated.
David Hollingworth, associate director at L&C, added: “We are confident that their broad range of sharply priced mortgages will appeal to customers and advisers alike.”
Product | Max LTV | Fee Product (Product Fee + £195 non-refundable booking fee applies) | Product Fee | APR | No Fee Product (No Product Fee. £195 non-refundable booking fee applies) | APR |
2 year fixed until 30/06/2018 | 60% 75% 80% 85% 90% | 1.67% 1.72% 1.84% 1.94% 2.28% | £1,300 £1,300 £800 £800 £800
| 3.9% 3.9% 3.9% 4.0% 4.0% | 2.07% 2.12% 2.24% 2.34% 2.68%
| 4.0% 4.0% 4.0% 4.0% 4.0%
|
| ||||||
3 year fixed until 30/06/2019 | 60% 75% 80% 85% 90% | 1.99% 2.29% 2.34% 2.34% 2.99% | £800 £800 £800 £800 £800
| 3.8% 3.9% 3.9% 3.9% 4.0% | 2.39% 2.69% 2.74% 2.74% 3.39%
| 3.9% 3.9% 3.9% 4.0% 4.1%
|
|
|
| ||||
5 year fixed until 30/06/2021 | 60% 75% 80% 85% 90% | 2.34% 2.49% 2.59% 2.79% 3.39% | £800 £800 £800 £800 £800
| 3.6% 3.7% 3.7% 3.8% 4.0% | 2.74% 2.89% 2.99% 3.19% 3.79%
| 3.7% 3.8% 3.8% 3.9% 4.1%
|
|
| |||||
2 year tracker until 30/06/2018 | 60%
75%
80%
85%
90% | 1.35% (BoE* base rate plus 0.85%)
1.45% (BoE base rate plus 0.95%)
1.69% (BoE base rate plus 1.19%)
1.79% (BoE base rate plus 1.29%)
2.50% (BoE base rate plus 2.00%) | £800
£800
£800
£800
£800 | 3.9%
3.9%
3.9%
3.9%
4.1% | 1.75% (BoE base rate plus 1.25%)
1.85% (BoE base rate plus 1.35%)
2.09% (BoE base rate plus 1.59%)
2.19% (BoE base rate plus 1.69%)
2.90% (BoE base rate plus 2.40%) | 3.9%
3.9%
3.9%
4.0%
4.1% |
In February 2015, Mr Higgins revealed Tesco Bank was laying the groundwork to offer mortgages through intermediaries in the first half of 2016.
This followed a move into the intermediated market by HSBC at the tail end of 2014, providing residential mortgages in partnership with Countrywide Mortgage Services.
Over 70 per cent of the mortgages in the UK are obtained through brokers rather than banks or building societies directly.
