The Intermediary Mortgage Lenders Association (IMLA) and the Association of Mortgage Intermediaries (AMI) have published an online guide to explain the different types of funding used by mortgage lenders.

The guide, ‘Understanding lender funding, product pricing and availability’ has been designed following the recent and ongoing interest rate volatility, and explains how the type and split of funding sources impacts individual providers’ ability to responds to interest rate changes.

Its purpose is to be accessible for anyone in the industry, assuming no prior knowledge, with explanations coming from technical specialists in the sector.

It also answers questions to support mortgage professionals on what they can do to offer more notice of product withdrawals and what would happen if the 24-hour product withdrawal notice period becomes mandatory.

Chief executive of AMI, Robert Sinclair, said: “Interest rate volatility is the new normal, and unhappily it is causing a great deal of stress and difficulty for advisers and their clients. In this environment, understanding the rationale behind mortgage pricing and product availability can give brokers valuable insight to help their customers make good decisions.

“That is why we at AMI and IMLA have come together to create this Q&A guide. In addition, we will continue to talk to lenders and other trade bodies about reasonable notice periods for product withdrawal.”

Executive director at IMLA, Kate Davies, added: “We hope this guide will clarify the motivations and constraints lenders are operating within, and promote better understanding between lenders and brokers. It is essential we evolve as an industry to meet the demands of a shifting financial climate, and to that end, we are calling on all parties to maintain open dialogue.”

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