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What is a Product Transfer?
When the mortgage deal that you are on initially finally reaches the point of confusion, your mortgage lender may wish to offer you a new deal for you to accept, ensuring that you stay with them. This kind of deal is known as a product transfer.
Are you rewarded for being loyal?
Although it would be nice, you will not be rewarded by a mortgage lender for your loyalty. The offer that they make you may not be competitive with the kinds of deals you could have access to elsewhere.
What also tends to be an annoyance for customers, is that the mortgage rates for these product transfers are not as good as the types of rates they would be offering their new customers. Great for a first-time buyer, not so much for an existing homeowner.
Tempted by an online switch?
It may look like a fairly simple, straightforward process to just swap onto your current lenders new deal, but please always bear in mind that it will be in your interest to at least have a look at what other deals you may be eligible for.
You might find that your lender tries to sway you onto their deal, without providing any mortgage advice.
This can be a really risky process, because if you go into their new deal without advice, you are essentially saying goodbye to all the valuable consumer protection you would otherwise have benefitted from by speaking to a Remortgage broker in York.
You’ll Be Giving Up Your Mortgage Rights
Over the years we have seen numerous examples of customers just agreeing to go onto these “follow-on” deals and locking themselves into a deal that is not appropriate for their circumstances.
The kicker here, is that because they agreed to move onto the deal out without taking any mortgage advice, they have waived a lot of their rights in terms of making a complaint about the lender or the deal.
We once had a mortgage case where a customer who was going to switch online with same lender after checking online mortgage rates and thinking the current lender is offering the cheapest interest rate and fortunately he made a call to us just to check and we found better deal for the customer and mange offer a product which was £4600 over 2 years.
