"As tracker mortgages are proving extremely popular at present, I suspect this move is to manage workflow and volume ahead of the base rate announcement on Thursday."
Coventry for Intermediaries has announced that, from 8pm Wednesday, it is closing its BBR tracker rates for owner-occupied and buy-to-let lending, including porting, further advances and product transfers.
Craig Fish, founder and director at Lodestone Mortgages & Protection: "Coventry is one of the more popular lenders in the tracker space, as their products are penalty-free, meaning they offer great flexibility. As tracker mortgages are proving extremely popular at present, I suspect this move is to manage workflow and volume ahead of the base rate announcement on Thursday. No doubt they will be back in due course."
Lewis Shaw, owner and mortgage broker at Riverside Mortgages: "It's unsurprising that with another Bank of England Monetary Policy Committee meeting on Thursday, lenders are starting to reassess their product ranges. Coventry Building Society is on the money by removing its product range the night before the base rate hike. I've been trying to convince prospective remortgage clients that it would make sense to submit deals before Thursday so that we can secure a rate and then reassess if that's the best product when the dust settles from this next hike. I'm sick of hearing my own voice, as with some prospective clients, it can be like talking to a brick wall. Yet here we are with the start of the emails brokers receive before we have another round of repricing. One day clients will believe what experienced brokers say; until then, expect more panicked phone calls come Friday."
Paul Neal, mortgage and equity release specialist at Missing Element Mortgage Services: "I don't think Coventry will be the first or last lender to do this. As fixed rates have rocketed, we are finding more and more clients opting for variable and discounted rates. Even with the looming Bank of England rate increase, they are still a much more attractive option than a fixed rate."
Justin Moy, managing director at EHF Mortgages: "I think this is just in readiness of the potential base rate change this week, and that the products will need refreshing accordingly. What we need to check on is the margin over base rate that the replacement products will be, and whether that margin narrows in any way."
Rhys Schofield, managing director at Peak Money: "I'd be careful of reading too much into this. With an impending Bank of England meeting it's probably pretty sensible to pause offing a product linked to whatever they decide to do with base rate until after the decision. Don't be surprised to see it re-launched and re-priced accordingly."
Gary Boakes, director at Verve Financial: "A nice reminder of the impending base rate rise this week, Coventry like every lender taking the opportunity to re-price and re-launch products. Coventry pricing has been top 2-3 over the last week or so, so this could just be a sign that service is starting to struggle."
Rob Gill, managing director at Altura Mortgage Finance: "Tracker rates have become increasingly popular in recent weeks. Not only are they significantly cheaper than fixed rates at the currently, they also offer the tantalising prospect that base rate may start to fall next year as inflation recedes and we enter recession. With margins as low as 0.24% above base, a falling base rate could see those who take a tracker now paying a very low rate in 2023-24."
