News Article Published:
Wednesday, 20 August 2008
Category:
Financial Services
Lenders are taking a more honest approach with their mortgage product marketing rather than relying on "headline rates", one expert has claimed.
According to research by Moneysupermarket.com, the average best rate for a typical two-year fixed-rate deal has increased from 5.73 per cent to 6.15 per cent over the last 12 months.
Louise Cuming, head of mortgages at the comparison site, remarks that lenders no longer need to try as hard to "hook borrowers" with their mortgage marketing communications.
She said: "Often a great headline rate has come with an extortionate fee, but lenders are being much more transparent now about the true cost to the consumer and where their profit comes from.
"Higher rates might seem unpalatable for some people, however those lower fees can make it cheaper for borrowers on a smaller mortgage. Consumers must look at both the fee and the rate if they want to work out the best deal for them."
However, this has not meant the end of competition when it comes to financial services marketing.
Halifax and Abbey last week continued with attempts to outdo each other by undercutting rates on their competing two-year tracker deals marketed through intermediaries.
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