When you go to stores like Marks & Spencer, it’s fair to say that a mortgage isn’t the first thing you’d think of picking up. Things are about to change though as the banking side of the store looks set to be selling mortgages.
Shops such as Marks & Spencers have made a move into finance with the likes of Tesco and Sainsbury’s banking chains making moves into the mortgage world. It will be interesting to see what they can bring to the market that is different than the main high street banks.
In the first move into selling mortgages, Marks & Spencers will first be selling to first-time buyers and home movers. There has been no mention of people who are looking to remortgage their properties, so this may be one option that they hold off on for now.
Their main aim will be to offer competitive rates across a rate of terms. More details will be revealed on what they will be offering in the new year. To announce it now though shows that the plans are in full motion for a big reveal to the customers.
The shopping chain are looking to use their popularity with customers who know the name of Marks & Spencer and trust the brand. It is hoped that the trust they have in the company will help them branch into mortgages and offering a service that is more attractive than the ones that normal banks have.
It will be interesting to see just how customers react to the Marks & Spencer mortgages and if it can pull customers away from the more traditional banks. With something as important as a mortgage, a lot of trust is put into the bank as a mortgage is an investment that needs to be taken up with confidence. If the lender can’t create the confidence in the product, then there is little chance that customers will make a move to get the Marks & Spencer mortgage.
One thing that customers may not be aware of is who actually owns the banking side of Marks & Spencer though. Initially set up by the company, it is now a joint venture between them and HSBC, who purchased it fully in 2004. So, Marks and Spencer Banking is actually completely separate from the company, with its own banking licence and board.
The mortgage is set to be launched in early 2018, but no date has been set yet. More details will no doubt be revealed next year, leading up to the full reveal of products and rates.