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spyguy

Tesco throw towel in on blue n white mortgages

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http://www.lse.co.uk/FinanceNews.asp?code=6nkn5ybb&headline=Britains_Tesco_to_stop_mortgage_lending_at_bank_unit

Which means that pure mortgage banks, like Nationwide, must be bleeding cash or lending themselves bust.

If theres no money in mortgages - and it looks like revenue and margins are very low- then there's going to be little mortgage lending going forward.

 

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38 minutes ago, spyguy said:

http://www.lse.co.uk/FinanceNews.asp?code=6nkn5ybb&headline=Britains_Tesco_to_stop_mortgage_lending_at_bank_unit

Which means that pure mortgage banks, like Nationwide, must be bleeding cash or lending themselves bust.

If theres no money in mortgages - and it looks like revenue and margins are very low- then there's going to be little mortgage lending going forward.

 

As I've said before the Building Societies like Nationwide infuriate me lending into BTL.....NW has done everything it could to protect it's mutual status and then gone right on and behaved like a "for profit" bank...contributing to jacking up prices, forcing potential OO's into perpetual rentals or essentially contributed to OO's taking on higher debt loads......

The challenger bank Metro has been the surprise **** up what's lurking under NW's bonnet ?

And btw Metro Bank with having a clean slate for all their systems and processes vs the legacy systems that the others have to grapple with should have had a clear business advantage by being cleaner and leaner therefore with less cost overheads......seems they didn't employ the right people who knew what they were doing and they not only squandered that adavantage they have turned it into a negative....good going jerks....talk about snatching defeat from the jaws of victory

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47 minutes ago, spyguy said:

http://www.lse.co.uk/FinanceNews.asp?code=6nkn5ybb&headline=Britains_Tesco_to_stop_mortgage_lending_at_bank_unit

Which means that pure mortgage banks, like Nationwide, must be bleeding cash or lending themselves bust.

If theres no money in mortgages - and it looks like revenue and margins are very low- then there's going to be little mortgage lending going forward.

 

Or.....mortgage costs will rise?

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4 minutes ago, anonguest said:

Or.....mortgage costs will rise?

Hard to know.

We are not in Kansas anymore.

Banks n BSes were flush with TFL and scam money, which theyve failed to lend prudently.

Their mortgages books are shrinking, as people pay them off and fewer people can afford to take out mortgages.

 

 

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11 hours ago, spyguy said:

Which means that pure mortgage banks, like Nationwide, must be bleeding cash or lending themselves bust.

Not really. It means that the new banks set up mortgages with low or no interest rate margin in order to gain market share.

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2 minutes ago, Ghostly said:

Not really. It means that the new banks set up mortgages with low or no interest rate margin in order to gain market share.

why would they want market share again?

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28 minutes ago, Ghostly said:

Not really. It means that the new banks set up mortgages with low or no interest rate margin in order to gain market share.

Nope.

Tesco are *much* better managed than the likes of NW.

And they are bigger. And have cash float to lower funding costs.

 

 

 

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38 minutes ago, TheCountOfNowhere said:

Margins are too tight. Mortgages rates will need to rise or lenders will have to shut down. 

Margins too tight.

Risk/lending too loose.

Increase margins  or die.

 

 

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11 minutes ago, spyguy said:

Margins too tight.

Risk/lending too loose.

Increase margins  or die.

 

 

They'll chose the Jesus scenario ...death followed 3 days later by resurrection, their follower will then have to ante up once a week to keep them going. 

 

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Tesco are essentially a supermarket selling groceries and mortgages probably are a tiny part of the overall business so maybe just not worth the effort for them.

They have experimented with estate agency years ago (abandoned it) and even online catalogue shopping (abandoned that too) suggesting they won't branch out too far from their core business (which itself is already a tight margin business).

If so, I am not sure we can say that means much for other lenders one way or the other.

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25 minutes ago, nightowl said:

Tesco are essentially a supermarket selling groceries and mortgages probably are a tiny part of the overall business so maybe just not worth the effort for them.

 They have experimented with estate agency years ago (abandoned it) and even online catalogue shopping (abandoned that too) suggesting they won't branch out too far from their core business (which itself is already a tight margin business).

If so, I am not sure we can say that means much for other lenders one way or the other.

Spot on.. too much lending and too much competition in mortgages( quite the opposite of what other contributors are saying in this thread)

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2 hours ago, nightowl said:

Tesco are essentially a supermarket selling groceries and mortgages probably are a tiny part of the overall business so maybe just not worth the effort for them.

They have experimented with estate agency years ago (abandoned it) and even online catalogue shopping (abandoned that too) suggesting they won't branch out too far from their core business (which itself is already a tight margin business).

If so, I am not sure we can say that means much for other lenders one way or the other.

No.

Tesco, like all companies are a software driven logistics operation.

Dont fall for all that twee BS from EAs, who are getting their ar5e served to them on a plate.

EAs, as in branch of Myles n Purple Cords, on the high street are dead, finished. Over.

Even with the extra complications of having a bank, Tesco's are still able to raise finance and leverage its balance sheet to operate bank facilities.

Orgs like Nationwide, being a mutual, are very restrained on raising finance.

Tesco - market cap 22bln.

MetroBank market cap 700m.

 

Tesco also has much greater scale to put stuff online- banks applications, house ads etc etc etc.

And deal with the software - just look at TSB. 

 

 

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It gets better:

https://www.dailymail.co.uk/money/mortgageshome/article-7078543/MPs-call-Tesco-Bank-prevent-mortgage-prisoners-sell-active-lender.html

Quote

Tesco Bank has refused to guarantee that its mortgage customers will not be sold to a 'vulture fund or inactive lender' - leading to fears they could become 'mortgage prisoners'.

Some 23,000 customers were left in the lurch last week as Tesco Bank announced it was exploring the sale of its mortgage book after ceasing all new lending. 

Tesco Bank has since come under pressure from MPs to guarantee it will only sell its mortgage book to a regulated and active lender - amid fears that otherwise it would trap some borrowers on deals they cannot switch away from.  

 

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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