Sainsbury's shuts down mortgage business

Sainsbury's Bank revealed that from today it will no longer offer new mortgages.

Sainsbury's announcement comes as part of its Q2 trading update. It told us this change affects new customers only. It does not directly impact existing mortgage customers.

As an existing customer, your rates should remain as they are in your contract. This goes for all mortgage types: fixed, tracker and variable.

When you come to the end of your existing deal, you'll revert to the Sainsbury's Bank SVR as normal.

If you applied to Sainsbury's Bank for a mortgage before today's announcement, your application will be subject to the same lending criteria as before.

Sainsbury's told us it had briefed all its mortgage broker partners of the change.

If you're still within your promotional period but are now tempted to switch lender, you'll have to pay an early redemption charge.

Sainsbury's is the second supermarket bank to stop offering mortgages. Earlier this month, Tesco Bank sold its mortgage portfolio to Halifax. Halifax is part of the Lloyds Banking Group, one of the UK's biggest mortgage lenders.

Sainsbury's has not yet sold its mortgage portfolio to another lender. But this does not mean you will become a mortgage prisoner, following the FCA's recent rule changes.

To speak to someone at Sainsbury's Bank, it recommended you follow the usual channels.

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Last updated: 25 September, 2019

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