State backed banks came under fire this week, with an investigation by the Daily Mail focusing on the products and services offered by Northern Rock, RBS and the Lloyds Group. All 3 banks have a Government guarantee that savers’ money will be protected and are therefore able to offer headline-grabbing savings and mortgage deals, dominating best buy tables and leaving smaller building societies struggling to compete. In terms of criteria however, they are not so generous, with Northern Rock currently only lending up to 85% of property value, despite an assurance by the Chancellor last year that they would provide more help to First Time Buyers by lending up to 90%.
The Daily Express continued in a similar vein by looking at what criteria borrowers now need to pass in order to secure a good rate. Again experts suggested that deposit is a major stumbling block for many, with very few products available to those with less than 15% equity, resulting in much higher rates.
Elsewhere the Mirror looked at the growing trend for cross-selling, suggesting that banks such as Halifax and Nationwide now see the current account as an important opportunity to compete with other lenders and retain business by offering preferential mortgage and savings rates to existing account holders.