Mortgage lenders have a derogatory name for people who switch mortgage lenders to follow lower rates they call them Rate Tarts. The author has a much more apt description Shrewd Shoppers! After all, who spends more for exactly the same product, in this case money, when you can get it cheaper elsewhere? After all a from one lender as effective as a from another!
The mortgage market is highly competitive and as long as lenders use price as the main weapon in their marketing platform, price competition will encourage remortgagers to follow cheaper deals. Call them Rate Tarts if you must, but they’ll be the richer for it!
In a response to curb mortgage switching, some lenders have raised their up-front charges and others improved their customer retention programmes. In such a competitive market, accolades will be awarded for the best customer retention programmes but raising up front charges, will simply reduce the lenders market share, albeit on improved profit margins. It seems that lenders still have to learn that carrots are better than sticks!
For example, Birmingham Midshires currently offers a 3.89% two year fixed deal. This looks like a...
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