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Sainsbury’s pulls out of mortgage market

Owain Thomas
Written By:
Owain Thomas

Sainsbury’s Bank has stopped offering new mortgages, following in the footsteps of rival Tesco.

All current mortgage offers will be honoured, subject to valuations and other details being completed, the lender confirmed.

If borrowers have already booked a deal and now want to cancel, they will not receive a refund of any fees paid.

A spokesperson said it was “business as usual” for existing customers. The bank would not disclose customer numbers.

It is likely Sainsbury’s will come under the same pressure as Tesco Bank to sell its closed book of customers to an active lender and not risk creating future mortgage prisoners.

A spokesperson said it was “looking at all options” for a future sale.

Strategic review

Sainsbury’s completed £1.1bn in mortgage lending in 2018 and said the decision had come around as a product of a strategic review into its financial services arm.

It noted that since relaunching its mortgage offering in 2017, the market had become more competitive and the revision will let the supermarket focus on other products.

Speculation had been surrounding Sainsbury’s future in the market following Tesco Bank’s exit after it closed to new lending and sold its mortgage book to Lloyds Bank earlier this month.

Last week The Telegraph published reports that the lender had been consulting advisers about how much it could raise from the sale of its £1.4bn book of loans.