According to one source, the Northern Rock brand has been damaged to such an extent that once consumers know their Northern Rock mortgage has come to the end of its deal period, they will move away from the lender.
The source also feared that advisers would have a tough time convincing clients to remortgage to the lender if they recommended a Northern Rock product.
He said: “People won’t forget the queues they saw on TV for a long time, so even if Northern Rock comes back with some competitive products, there is still going to be a stigma attached to the brand. Once the charges don’t apply, I can see a lot of people remortgaging away from the lender. For many people, it’s not about the business but the reputation – they’re scared.”
Stephen Brown, senior technical director of MoneyQuest, believed there would be some interesting times ahead.
“It will be interesting to see its retention figures. But it might be a good thing for it to lose a few customers. It has got a lot of riskier products with high loan-to-values – it’s been doing the ‘Together’ product for 10 years now. I know a lot of brokers who used it to get through some higher risk business because it only required a few documents.”
However, Michael Brill, director of Baronworth Investment Services, said: “I don’t think it will change. If it hasn’t got competitive products then brokers will go elsewhere but not for other reasons.”
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