Metro Bank drops fees for mortgage switchers

Metro Bank drops fees for mortgage switchers

Metro Bank has dropped product fees for existing residential borrowers looking to switch rates or secure a further advance on loans up to £2m.

The bank, which previously offered existing residential mortgage customers half-price fees of £499 when transferring to a new product, said it had made the move in response to feedback from intermediaries.

Metro Bank’s mortgages for existing customers currently include a two-year fix at 1.99 per cent and a five-year fix at 2.04 per cent, both up to 75 per cent loan-to-value.

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Charles Morley, director of mortgage distribution at Metro Bank, said: “We want a relationship for the long-term with both our customers and broker partners, not just a short-term fling.

"That Is why we’ve abolished fees for existing residential mortgage customers. 

“What Is more, not only can customers choose to switch up to three months early without incurring an early repayment charge, but with our mortgage switching portal it only takes a matter of minutes to change products, whether you’re a broker or a customer.”

Oliver Marley, mortgage adviser and head of research at London-based Independent James, welcomed the decision to remove the fees.

“It does tend to get expensive over the long term to keep refinancing every couple of years and for something as simple as a rate switch it is hard to justify high fees,” he said. 

“If they can offer rates without a fee, then that is brilliant. You can imagine a number of other lenders starting to jump on the bandwagon.”

He added that lower rates are available from other lenders and that would also be a factor in deciding which is the best deal for clients.