Two UK lenders temporarily pull new mortgage deals amid volatile market

theguardian.com:

UK lenders Virgin Money and Skipton Building Society temporarily withdrew mortgage deals for new customers on Monday, reacting to financial market volatility prompted by the government’s mini-budget.

Lenders were struggling to accurately price their products, after the pound fell to new lows and sent the interest rate on government debts to a 12-year high, in what brokers predicted is just the start of a major shift in the UK mortgage market.

Virgin Money sent an alert to brokers notifying them that it would temporarily withdraw its mortgage products for new customers by 8pm on Monday. Similar notifications were sent by Skipton Building Society, which said it would pull its own products immediately.

“Following last week’s [Bank of England base rate hike to 2.25%] and the government’s subsequent mini-budget, we continue to see the market response unfold,” Skipton said in an email to brokers. “In response, we will be temporarily withdrawing our new business product range with immediate effect.”

“We haven’t taken this decision lightly but have done so in order to avoid further disruption for you and your clients,” Skipton added.

A spokesperson for the building society said it was hoping to reprice its mortgages and assured that “a new range will shortly be on sale”. “Customers with applications in progress are not affected by this and our existing customer range still remains available,” they added.

Earlier on Monday, Halifax, the UK’s largest mortage lender, said it had withdrawn its mortgage products offering arrangement fees in return for lower interest rates and was moving to a full fee-free range.

It was the latest fallout from the government’s mini-budget on Friday, with investors concerned over the long-term impact of