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MONEY HONEY ?

Moneyfacts.co.uk

Saturday 12th October 2019

 

 

Savings      ISAs      Mortgages         Cards         Banking          Loans         Business         

Ethical savings brands beat the big banks

Savers may not be getting a decent return on their flexible nest egg with the big high street banks, but they could do better by investing with an ethical alternative according to the latest research by Moneyfacts.co.uk.

Our data shows that most ethical brands offer higher returns than high street banks on easy access accounts. There are also ethical brands paying decent returns on notice accounts too.

Gatehouse Bank currently pays a highly competitive 1.40% as an expected profit rate on its easy access account, so savers may want to review where they are currently saving their cash and consider switching to not just to hunt down a better rate, but to move to a more ethical brand. In comparison, the highest new customer rate for an easy access account from a big bank pays just 0.40%.

 

Rachel Springall, Finance Expert at Moneyfacts.co.uk, said “Savers may well be rethinking how they invest and want to know whether they are banking with a brand that is giving back to the community. Ecology Building Society for example gives back via community projects and lent £38.4 million in 2018 to support 255 sustainable properties and projects. Its Easy Access account may pay less than 1%, but it still beats the rates offered to new customers from the biggest high street banks.”

 

See the original story and find a great easy access savings account now…

 AERNotice / Term 

Easy Access

1.46%

None

View table

Fixed Rate Bonds

2.32%

24 Months

View table

Fixed Rate ISAs

2.01%

5 Years

View
table

Variable Rate ISAs

1.51%

180 Days

View
table

Regular Savings Account

4.00%

Instant

View table

Notice Accounts

1.71%

90 Days

View table

Monthly Interest Accounts

1.83%

18 Months

View table

 

Deal of the week

Online Saver (1)

Paying a variable rate of 1.26% AER yearly for deposits from just £100, this account is open to savers looking to invest a maximum of £250,000. Being an easy access account, withdrawals – subject to a minimum of £100 – are not restricted. Making further additions to your nest egg is similarly easy, with deposits able to be made via debit card, bank transfer and transfer from another bank.

 

Savers aged 16 and above can apply, while this account must be opened and managed online, making operation easy outside of normal banking hours.

Product Spotlight: Three-year fixed rate bonds

If you don’t want to lock your money away for too long but are looking for a better return than short-term investments, a three-year fixed rate bond could be just the thing:

• Al Rayan Bank’s Fixed Term Deposit is top paying an expected profit rate of 2.42% quarterly on a minimum deposit of £1,000. As is typical of a fixed rate bond, no withdrawals or further additions are allowed. The account can be both opened and managed online, in branch, by phone, by post and via its mobile app. This bank operates under Islamic finance principles.

• The Premier Deposit Account from Bank of London and the Middle East (BLME) sits second in the charts, offering an expected profit rate of 2.25% on the anniversary of opening. From a minimum deposit of £1,000, this account stipulates that investors must have or open a BLME transfer account to hold funds pending investment. Neither withdrawals nor further additions are allowed and this account must be opened online and then operated by post. BLME operates under Islamic finance principles.

• There are no opening restrictions on the Fixed Term Deposit account from Gatehouse Bank, paying an expected profit of 2.25% on its anniversary, on a minimum deposit of £1,000. The account, which can only be opened and operated online, does not permit withdrawals or further additions and is subject to Islamic finance principles.

Top products – At a glance

Top Savings Accounts

Easy Access: Coventry Building Society Triple Access Saver (1.46% AER var) Min Open Bal £1

One-year fix ISA: Al Rayan Bank Fixed Term Deposit Cash ISA (1.61% Expected rate) – Min Open Bal £1000

Personal Loans  

£5000 over 36 mths: Zopa Personal Loan(Monthly repayment: £146.17 – 3.4% rep APR)

Admiral Personal Loan (Monthly repayment: £146.17 – 3.4% rep APR)

 

Secured Loans

For £25,000 over 10 years: Masthaven Bank Flexible Secured Loan (3.9% rep APRC variable)

House prices at slowest growth since 2013

While there has been a year-on-year increase in house prices, the housing market is at its slowest level of growth since April 2013, the latest Halifax House Price Index reveals.

The average house price in September was £232,574. This is just 1.1% higher than the same month the previous year and only a 0.4% increase from July to September compared to April to June. As well as this, the House Price Index shows that house prices fell by 0.4% in September compared to August.

Despite the slowing house prices, mortgage competition between lenders has remained strong. There are currently mortgage deals offering two-year fixed rates from as low as 1.19% on a 60% loan-to-value (LTV). Those looking for a 60% LTV can also get five-year fixed rate deals from as low as 1.54% at the moment.

 

First-time buyers are likely to benefit most from the stagnating housing market and, while mortgage competition has slowed in recent months, there are still some highly competitive rates available in our charts. The lowest two-year fixed rate currently available for first-time buyers is 2.59% on a 95% LTV. Meanwhile, first-time buyers looking to lock their mortgage into a longer term can get a fixed rate from as low as 2.75% for a five-year term.

 

Read the whole story and get a comprehensive view of current mortgage rates with our moving home mortgage chart

Product Spotlight: Two-year fixed rate for remortgages

If your current mortgage deal is coming to an end, now may be a good time to consider securing your payments into a two-year fixed rate mortgage.

• NatWest tops our chart offering a rate of 1.19% (3.8% APRC) fixed until 31 January 2022, at which point it reverts to 4.24% variable. This deal is for a maximum 60% loan-to-value (LTV) and requires a minimum loan of £25,000, to a maximum that is determined by LTV. This mortgage charges £995 in product fees and includes the incentives of free valuation and no legal fees. Overpayments are allowed.

• Barclays Mortgage is second in our chart with a rate of 1.21% (3.8% APRC) fixed until 31 January 2022, which then reverts to 4.24% variable, and is available at a maximum 60% LTV. This deal requires a minimum loan of £5,000, up to a maximum of £2 million. It charges £999 in product fees and includes the incentives of free valuation and the choice of either no legal fees or £200 cashback. Overpayments are also allowed.

• Third place in our chart this week is HSBC with a remortgage deal that offers a rate of 1.24% (3.7% APRC) fixed until 31 January 2022, and then reverts to 4.19% variable. This mortgage is for those seeking a maximum 60% LTV and requires a minimum loan of £10,000, up to a maximum of £5 million, and charges £999 in product fees. It includes the incentives of free valuation and legal fees. Overpayments are allowed.

 RatePeriodAPRC 

First Time Buyer

2.59%
(F)

to

28/02/2022

5.1%

View table

Remortgage

1.39%
(DV)

2 Years

5.2%

View table

Buy-to-let

1.74%
(DV)

2 Years

5.9%

View table

Moving Home

1.19%
(F)

to 31/01/2022

3.7%

View table

 

Rep Example: £168,000 mortgage over 25 years initially at 2.59% fixed for 28 months reverting to 4.49% variable for 36 months and 5.99% variable for term. 28 monthly payments of £761.31, 36 monthly payments of £917.99 and 236 monthly payments of £1037.89. Total amount payable £300,244.36 includes loan amount, interest of £131,306, valuation fees of £265 and product fees of £498. The overall cost for comparison is 5.1% APRC representative.

Deal of the week

Two-year fixed rate mortgage,
60% loan-to-value

Suitable for remortgagers, as well as first and second-time buyers, this first direct mortgage offers a rate of 1.44% (3.8% APRC) fixed for two years before reverting to a variable rate of 4.19%. This deal is for borrowers seeking a maximum loan-to-value of 60% and is available for mortgages between £10,000 and £1 million. The relatively low product fees of £490 are enhanced by an incentives package that includes free valuation, as well as free legal fees for remortgagers. Overpayments are also allowed.  

 

Rep example: £178,000 mortgage over 25 years initially at 1.44% fixed for 24 months reverting to 4.19% variable for term. 24 monthly payments of £706.88 and 276 monthly payments of £938.05. Total amount payable £276,676.92 includes loan amount, interest of £97,867, valuation fees of £0 and product fees of £490. The overall cost for comparison is 3.8% APRC representative.

Technology-based banking products launched

Both NatWest and Metro Bank have announced that they are launching new technology-based products that are designed to make their customers’ money management easier and more secure.

NatWest revealed that it has partnered with Mastercard and digital security provider Gemalto to pilot a biometric fingerprint credit card. The banking giant is trialling the new card with 150 customers over the next three months.

The credit card enables customers to make contactless payments using fingerprint verification and enables transactions of up to £100, £70 above the current limit. The card, that lights up green when the fingerprint has been verified, can be used in ATMs, with existing contactless Chip and PIN terminals and for online shopping.

Meanwhile, Metro Bank has also been investing in new technology and announced that it has launched ‘Business Insights’ an artificial intelligence-led, in-app account insights tool for its business customers. The app, that was created in partnership with Personetics, has been designed to enable business customers to make more data-driven decisions with their business account and offers services such as end-of-month cash flow analysis, notifications when latest payments to service providers are higher or lower than normal, and notifications about upcoming scheduled payments.

Read the full story online and take a look at our credit card or business accounts charts…

 

Deal of the week

95 Day Notice Savings Account

Unusually for a savings product, Moneybox’s 95-day notice account is opened and operated by mobile phone app only. For those who prefer banking on the move, it offers a rate of 1.65% AER variable on a minimum investment of just £1. Interest is paid monthly, with both withdrawals (subject to the 95 days’ notice stipulated) and further additions welcome. Opening restrictions are limited to those over 18 who wish to invest up to £85,000.

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