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Loyalty to your bank will hurt your pocket

Loyalty to your bank will hurt your pocket

Category: Money

Updated: 31/10/2008
First Published: 11/08/2008

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Many people are loyal to their bank and go to them for everything from their current account to their mortgage and credit card. However, by doing so you could find yourself seriously out of pocket as the big named banks do not tend to have the best rates.

By shopping around and opting for the best buys, you could save yourself substantial amounts of money.

InstitutionTotal increased cost/lost interest
Barclays
£2,575.99
Lloyds TSB
£3,096.61
HSBC
£1,929.34
Royal Bank of Scotland
£3,442.89
Halifax
£5,024.10
Abbey
£3,110.60
Source: Moneyfacts.co.uk 11.8.08

Consumers who are loyal to Halifax are the hardest hit, finding themselves over £5K worse off, with Royal Bank of Scotland customers not far behind at nearly £3.5K. HSBC customers come out best by being just under £2K worse off, but that is still a large amount, particularly in the current economic climate where every penny counts.

The big banks trade on their names and it is disappointing that they do not offer more competitive deals to their customers.

Particularly when shopping for a mortgage, customers need to make sure they do their homework in order to secure the best deal possible. Mortgage brokers do not have access to 100% of deals, so borrowers should make sure they are aware of what deals are available direct from lenders.

The institutions are keen to tempt savings and current account customers through their doors and as a result have made switching as easy as possible. Current account institutions have switcher services which transfer your existing regular payments for you.

The banks are not loyal to you, so why should you be loyal to them?

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Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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