Moneyfacts.co.uk – weekly product update 07/11/2007
- More loan providers back out of the market
- Abbey current account tops takes the top spot
- Self certification borrowers feeling the pinch
Samantha Owens, Head of Personal Finance at Moneyfacts.co.uk comments:
More loan providers back out of the market
“Competitive loan rates can still be found, especially if you are borrowing larger sums of money. But as rates continue to rise and lenders begin to withdraw from the market, it could look a very different picture in a few months’ time.
“Leeds BS withdrew at the end of last week, with very competitive PPI charges and low rates on small loans, it left a hole at the top of some of the best buys. And this week GE Money follows suit, withdrawing its competitive rate of 6.9% on loans between £7.5K and £25K.
“Within the secured loans market, SPPL, LoanOne and, with effect from 9 November Money Partners have withdrawn their loan range.
“Rates have been rising gradually for some months, with competition putting increased pressures on margins and bad debts on the increase. But the credit crunch seems to be the final nail in the coffin, as lenders continue to raise rates but more surprisingly withdraw their products all together.
“Anyone looking for a loan would be advised to act sooner rather than later as there seems to be no let up in interest rate rises. If PPI is reformed, which it’s very much in need of, the landscape of competitive rates could become a thing of the past.”
Abbey current account tops take the top spot
“Abbey now pays 8% credit interest to new customers up to £1K and switcher customers £2.5K on it credit option current account.
“This is a market leading deal, paying 1.5% (AER) higher than its closest competitor. However you do need to be aware that it is only paid on balances up to £1K, unless you switch your account, when it is paid up to £2.5K.
“There are several current accounts offering great interest rates at the moment, better in fact than many savings deals to be found. Switching is easy, so don’t let your money sit in an account earning 0.10% interest. Take action and bag yourself one of these competitive deals.”
Company |
Account |
Deposit |
Gross |
Payable up to |
For |
Abbey |
The Abbey Current Account (Credit Option) |
£1 |
7.72% |
£2.5K to switcher, £1K to new customers |
First 12 months |
Alliance & Leicester |
Premier Direct Current |
£1 |
6.31% |
£2.5K |
until 31.1.09 |
Coventry BS |
First |
£1 |
6.17% |
£250K |
First 12 months |
Halifax |
High Interest Current Account |
£1 |
6.00% |
£2.5K |
|
Norwich & Peterborough BS |
Gold Current |
£1 |
4.75% |
£5K |
|
Nationwide BS |
FlexAccount |
£1 |
4.25% |
£3K |
|
Moneyfacts.co.uk (*minimum funding requirement may vary between accounts) |
|||||
Julia Harris, Mortgage Expert at Moneyfacts.co.uk comments:
Self certification mortgage borrowers feeling the pinch
“Risk limitation is the key feature of many of today’s mortgage changes. Subprime was the first casualty, with vastly tightened credit criteria and rate changes. Now it seems that the self certification market, both for prime and sub-prime borrowers is also beginning to feel the pinch.
“The charts below show just how different some of the deals have become since the credit crisis begunAlliance and Leicester (Prime)
August 2007 |
||
6.24% Fixed |
31.8.09 |
Fee £1,999 |
November 2007 |
||
7.74% Fixed |
30.11.09 |
Fee £1,999 |
Scarborough BS (Prime)
August 2007 |
||
6.04% Fixed |
30.9.09 |
Fee £995 |
November 2007 |
||
6.19% Fixed |
28.12.09 |
Fee £995 |
Mortgages PLC (light adverse to 75% LTV)
August 2007 |
||
7.82% Fixed |
2 years |
Fee 1% |
November 2007 |
||
8.75% Fixed |
2 years |
Fee 1.5% |
Scarborough Specialist Mortgages (light adverse to 70% LTV)
August 2007 |
||
6.69 % Fixed |
2 years |
Fee £1495 |
November 2007 |
||
7.94 % Fixed |
2 years |
Fee 1% |
“By withdrawing products, increasing rates or requiring larger deposits lenders are displaying a risk aversion to self certificated loans in the current climate. Higher risk borrowers will be finding it increasingly difficult to secure a loan, particularly at an attractive interest rate. It pays more than ever to search the market thoroughly to find the best deal for your individual circumstances.”
Moneyfacts Group
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