Banking News Mortgages And Savings Accounts For Existing Customers On The Rise 18471107

Mortgages and savings accounts for existing customers on the rise
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Mortgages and savings accounts for existing customers on the rise

28 July 2010 / by Rachael Stiles

The proportion of mortgages and regular savings accounts that are only available to existing customers of that provider has increased, according to research from consumer watchdog Which?

As reported in Which? Magazine, consumers have been discouraged from shopping around for the best deal since the proportion of existing customer products has increased dramatically in the first half of the year.

The number of products that are tied to other products from the same provider has seen a big increase during the past few years, Which? found, and is continuing to rise.

While some providers offer exclusive deals to existing customers, Which? is concerned that they might not always offer the best value for money, because the products they are tied to might not be the best deals available.

For example, an attractive interest rate might only be available to existing customers of a current account that does not pay any interest on balances that are in credit.

Which? urges consumers who are thinking of taking out a tied product to consider their options first and examine the whole package to calculate whether or not it offers the best deal.

The study found that in June, tied products accounted for 15 per cent of regular savings accounts, up from 11 per cent in January, 18 per cent of fixed rate mortgages, up from nine per cent, 21 per cent of tracker mortgages, up from 15 per cent, 17 per cent of credit cards, up from 16 per cent, and eight per cent of cash ISAs, up from seven per cent.

© Fair Investment Company Ltd

Written by Editorial Team