Fintech lenders Habito and Atom Bank withdraw their mortgages

By Oliver Smith on Friday 30 September 2022

Alternative Lending

Names join a number of high street banks from HSBC to Halifax who’ve also pulled their offerings.

Fintech lenders Habito and Atom Bank withdraw their mortgages
Image source: Tierra Mallorca/Unsplash.

UPDATE 30-09-2022 - This article has been updated to clarify that Molo Finance took the decision to withdraw its mortgages in Q2.

With some 40 per cent of available UK mortgages being withdrawn by lenders since Monday, according to Moneyfacts, thousands of borrowers are searching for options to avoid property sales and remortgages from falling through.

Unfortunately fintech mortgage lenders Habito and Atom Bank have pulled their mortgages too, some doing so in the wake of Chancellor Kwasi Kwarteng’s mini-budget on Friday that triggered turmoil in the financial markets.

Habito had previously offered its Habito One long-term fixed-rate mortgage at terms of up to 40 years, Atom Bank on the other hand offered more traditional mortgages of up to five-year terms, but only via mortgage brokers.

“In light of the rapid changes in markets in recent days Atom has withdrawn its product range whilst we and many other lenders reflect on what this means for mortgage prices,” Atom Bank’s chief customer officer Edward Twiddy told AltFi.

Twiddy described it as a “temporary action” that wouldn’t affect anyone with an existing valid mortgage offer, and said the bank aims “to return to mortgage lending as soon as possible.”

Habito is currently warning customers on its website of call delays of up to 60 minutes.

Molo Finance, another fintech lender, had offered a FlexLife mortgage that was available on terms between 15 and 40 years, but paused its lending in Q2.

Similarly Francesca Carlesi, CEO of Molo Finance, told AltFi that: “Due to the market volatility, all lending has temporarily been put on hold, including the FlexLife mortgages.”

The CEO said customers had responded to recent market volatility with “a rush to wanting to accelerate their application and locking a rate in as soon as possible before the situation deteriorates”

Before the withdrawal Molo had been offering rates of between 2.92 and 4.5 per cent depending on duration, Carlesi said the lender is “reviewing [the rates] in the current market context.”

Following Wednesday’s Bank of England intervention to start buying some £65bn worth of UK gilts, markets have started to settle and if the trend continues lenders might be able to start pricing new mortgages more accurately soon.

Habito didn’t respond to AltFi’s request for comment.

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Companies in this Article:

Atom Bank
Bank of England
Habito
Molo

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