Moneyfacts.co.uk – weekly product update 21/11/2007
- Innovation from the Halifax
- West Bromwich BS raises the savings bar – but not without a catch
Innovation from the Halifax
Today sees the launch of two new five-year fixed rate mortgage deals from the Halifax, with the unique feature of a three-year redemption charge. For first and second time buyers the rate is 5.99% fixed until 28.2.13, and for remortgage borrowers 6.09% to 28.2.13. Both charge a below average fee of £699 with early repayment charges of 4% to 28.2.09; 3% to 28.2.10; 2% to 28.2.11
David Knight, mortgage analyst at Moneyfacts.co.uk, comments:
“A short term fixed rate with a redemption free period is a first. The tide has completely turned, and with extended tie in products almost extinct, borrowers are now beginning to benefit from greater flexibility in the long and now short term markets too.
“With the deals such as Stroud & Swindon BS at 5.35% fixed for five years with a fee of £799 topping the charts, these new deals from the Halifax are not market leading when compared on rate and fee alone. But the unique feature of a redemption period of only three years may make this an appealing overall deal. Greater flexibility and the opportunity to respond to market conditions that may prevail in three years’ time could be a welcome feature worth paying that little bit extra for.
“A truly unique feature in its market. Let’s hope more lenders take this approach on board – in an unsettled financial market, flexibility is a must have feature for many borrowers.”
West Bromwich BS raises the savings bar – but not without a catch
West Bromwich BS raises the savings bar with the launch of its instant access Premier Bonus Tracker 4, paying a market-leading rate of 6.6% from £1K. However this is not without a catch. The rate includes two bonuses, 1.10% to 31.5.08, then 0.85% to 1.11.08, with the additional feature of a rate guarantee, which guarantees the rate to be Bank Base Rate plus 0.85% to 31.5.08, then Bank Base Rate plus 0.60% to 1.11.08 when account will revert to Direct Tracker Saver rate. But the most restrictive feature from this instant access account comes by means of capping the maximum number of withdrawals per year to six.
Rachel Thrussell, mortgage analyst at Moneyfacts.co.uk, comments:
“This new issue of the popular Premier Bonus Tracker 4 is paying the highest rate on the market for a no notice account. However, customers need to be aware that the account only allows 6 withdrawal per year and has a rather complicated bonus and rate guarantee structure to 1 November 2008, when the rate reverts to base rate minus 0.25% (currently 5.50%). If customers are happy with these terms and conditions, they will find this account hard to beat.
“I urge savers to look beyond the headline rate, otherwise they could find themselves bound by restrictive terms and conditions. Sometimes an instant access account does not do what it says on the tin.”
Moneyfacts Group
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