Print friendly version 1 Apr 2008

First Direct withdraws mortgages for new customers

Mortgage lender First Direct has temporarily stopped offering mortgages to non-customers in order to process the unprecedented number of applications it has had in recent weeks.

The lender will still allow existing customers to apply for mortgages and will resume offering mortgages to non-customers as soon as the backlog of applications has been dealt with. In the interim, HSBC – the bank’s parent lender – will offer new customers a two-year fixed-rate mortgage on similar terms to First Direct’s best-buy mortgage.

Chris Pilling, chief executive of First Direct, said: “We’ve seen unprecedented demand for our mortgages since January thanks to our highly competitive pricing and the decision of other lenders to raise rates. As a result, we’re currently seeing applications running at five times our normal volumes.

“The flood of interest in our mortgages has meant we’re taking longer than we’d like to handle applications, especially from non-customers. Rather than increase interest rates dramatically to discourage new applications, we’ve decided to withdraw temporarily from offering mortgages to non customers until we’ve cleared the backlog.”

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