A mortgage adviser has launched an online market comparison service to help borrowers control their mortgage costs.
Founded by Cardiff-based mortgage adviser Lee Flavin and business partners Jason Stallard and Lyanna Tsakiris, RateSwitch enables homeowners to find competitive loyalty deals from the UK’s leading lenders.
The free service marks a departure for the comparison site industry, having been set up by an independent financial adviser in a market dominated by commercial enterprises such as Moneysupermarket.
RateSwitch provides instant access to better rates without having to change lenders, as most typically allow their existing customers to switch to improved loyalty rates without the intervention of a credit check or underwriting assessment.
The launch of the service coincides with a new Financial Conduct Authority study looking into whether whether competition in the mortgage sector can be improved to benefit consumers.
Many borrowers are unable to switch lenders due to changes in personal circumstances such as credit status, earnings or employment type, leaving them stranded on their current lender’s standard variable rate (SVR).
An estimated 40 per cent of all residential borrowers repay their mortgages on their lender’s SVR - the uncompetitive default rate to which most introductory fixed and tracker deals automatically revert.
The site also retains the human element in a online transactional service that has previously faced criticism for not offering a personalised service that best meets customer needs.
Once rates have been sourced, experienced mortgage advisers are able to offer further advice on the rates available, calculate how much mortgage holders stand to save and, where applicable, get the rate switch process underway.
RateSwitch chief executive Mr Flavin said: “It’s been a long-held mission of mine to not only raise greater awareness of the unnecessary costs SVRs bring, but to provide homeowners with a tangible solution to the problem.
“For too long, too many have been paying out money that they simply don’t have to. RateSwitch has the power to disrupt this pattern by helping mortgage prisoners who have been stuck on SVR to finally break free.
“RateSwitch solves a sizeable problem by introducing a whole new dynamic. We’re very excited to join the current wave of start-ups striving to simplify complex processes within the mortgage industry, and believe that our existence will go a long way towards helping homeowners save money on their mortgage quickly, with minimal hassle.”