Mortgageforce chief executive Kevin Duffy has urged brokers and borrowers to take a measured view of recent mortgage market volatility warning that short-term product withdrawals and rate movements should not be mistaken for a long-term shift in pricing.
His comments come as a number of lenders have repriced or temporarily pulled products in response to rising swap rates and renewed geopolitical uncertainty, moves that have led to speculation that mortgage costs could climb sharply again in the weeks ahead.
Recent market movements have followed a period of relative stability at the start of the year, with expectations of a Bank of England rate cut now pushed back as inflation risks linked to global tensions, energy prices and bond market volatility have re-emerged.
In response, lenders have adjusted pricing and, in some cases, reduced product availability while they reassess funding costs.
OPERATIONAL PRESSURES
Duffy said the reaction in some parts of the media and wider market commentary risks overstating the scale of the change, noting that similar periods of disruption have occurred before and often prove short-lived.
He also suggested that lenders’ pricing decisions are not always driven solely by funding costs, with operational pressures sometimes playing a role when application volumes rise quickly and service levels come under strain.
He added that the current situation calls for perspective rather than panic.
He told Mortgage Soup: “The renowned baker Mr Kipling makes exceedingly good cakes. But the thought-cookies for digestion right now are from his namesake, Rudyard.
“Suffice to say, these are times for cool heads and rational thinking.
“If you believe the doom mongers on Sky TV, World War III is weeks away, Spurs are to be relegated and mortgage rates are going to the moon.”
“The melodrama on national television over lenders pulling their products is exactly that.”
He added: “The melodrama on national television over lenders pulling their products is exactly that. Whether you are a consumer or a mortgage broker, try to get past this sensationalism as my hunch is that in six weeks this hiatus will have passed.
“For what the general public may not know is that mortgage lenders have previously used the spectre of rising SWAP rates as a convenient justification for widening their profit margins and at the same time placing a handbrake on rampant application levels which are now hurting their service standards.
“My advice to consumers especially is just to keep calm and carry on, especially as the POTUS rarely actually finishes what he ill–advisedly starts.
“It is already clear that regardless of Trumps posturing world leaders elsewhere are starting to engage with Iran to de-escalate the political and economic turmoil.
“Trump may have started this economic dis-connect but thankfully more responsible leaders and global business practitioners may bring it to a swifter end than the bedwetters at Sky News would have you believe.”
