Articles >> Mortgage lenders 'should offer more innovative products'

policyholders have been told that mortgage providers should introduce more "innovation" in the deals that are being offered to customers.

Andy Pratt, chief operating officer at Alexander Hall, said that although it is standard practice for companies to offer loan-to-value (LTV) funding in five per cent increments, smaller increases could be more appropriate for borrowers.

He explained: "[Percentage point increases] on the average house values are significant and if a lender is looking to manage his business in terms of risk, then incrementally shifting things up by smaller than five per cent [gaps] would make sense."

Mr Pratt added that lenders seemed to be stuck in an "archaic" system in which they are reluctant to step away from standard procedure.

The comments come after uSwitch.com revealed that Brits pay almost £3 billion more on their home loans by adding the arrangement fee onto their mortgage, something which 35 per cent of homeowners have opted to do.