Santander is temporarily withdrawing residential and buy-to-let fixed and tracker rates at 7:30pm today (June 12).
The bank said that the full new business range will be relaunched on June 14 and attributed the withdrawal to “current market conditions”.
Explaining these market conditions, SelfEmployedMortgageHub.com founder, Graham Cox, stated: “Gilt yields and swap rates, which determine the cost of borrowing for lenders in the money markets, continue to climb in the wake of the disastrous inflation figures announced last month.
“The result is lenders are finding it increasingly difficult to price fixed-rate deals profitability."
Cox also said that any bank or building society that comes out cheapest is getting flooded with "too many applications to cope", something he believes is happening with Santander.
This news did not come as a shock to Lawson Financial director, Michelle Lawson, who said she was “not surprised” about the announcement and “fully expected this on Friday”.
“As products are not going to be launched until Wednesday, hopefully Santander will reprice for the longer term as TSB have announced today that they are actually reducing rates, which is promising,” she continued.
Lawson also stated: “Kudos to Santander for giving notice. I would still prefer 24 hours’ notice as per our campaign for the #24hrpledge, as this would have been known on Friday and even before then perhaps.”
This sentiment was echoed by EHF Mortgages managing director, Justin Moy, who stated: “They have given us a reasonable amount of notice compared to some lenders, although still not 24 hours.”
Lifetime Wealth Management mortgage and protection specialist, Katy Eatenton, expressed concern about the bank’s capacity: “Hopefully their systems will be able to cope with the massive influx of applications they will receive today.
Meanwhile, Altura Mortgage Finance managing director, Rob Gill, looked to the future: “While there are some tentative signs that market turmoil is settling, lenders are still working to manage volumes and recover from some very challenging market conditions over recent weeks.”
Santander’s news follows similar announcements from HSBC and Clydesdale Bank.
tom.dunstan@ft.com
