Brendan Burgess
Founder
- Messages
- 54,757
The Central Bank has published a note on mortgage switching.
I have read it and it seems to state the obvious. But I wonder if I am missing something.
There is no blanket ban imposed by the retail banks on taking on customers of vulture funds. The Central Bank has been going on about this for years. No one ever said there was. If BoSI sold a performing mortgage to Pepper(?) of course that customer could switch to another lender.
Low risk customers are more likely to switch than medium and high risk customers. Well spotted Sherlock!
What might appear surprising is that about 0.025% of medium and high risk customers switch every month.
So what is that? 0.3% a year.
3 out of every 1,000 credit impaired customers switch every year.
Even 3 sounds surprising but the categorisation is based on the risk of the portfolio sold by the lender. So 5 years ago, a borrower could have been in arrears and have since recovered. Or it could be a handful of older people switching to Spry Finance who don't care about your credit rating.
In other words, the customers of vulture funds who have bad credit ratings can't switch.
Brendan
I have read it and it seems to state the obvious. But I wonder if I am missing something.
There is no blanket ban imposed by the retail banks on taking on customers of vulture funds. The Central Bank has been going on about this for years. No one ever said there was. If BoSI sold a performing mortgage to Pepper(?) of course that customer could switch to another lender.
Low risk customers are more likely to switch than medium and high risk customers. Well spotted Sherlock!
What might appear surprising is that about 0.025% of medium and high risk customers switch every month.
So what is that? 0.3% a year.
3 out of every 1,000 credit impaired customers switch every year.
Even 3 sounds surprising but the categorisation is based on the risk of the portfolio sold by the lender. So 5 years ago, a borrower could have been in arrears and have since recovered. Or it could be a handful of older people switching to Spry Finance who don't care about your credit rating.
In other words, the customers of vulture funds who have bad credit ratings can't switch.
Brendan