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Five minute finance: Savings, cards and mortgages

Five minute finance: Savings, cards and mortgages

Category: Savings

Updated: 20/09/2010
First Published: 20/09/2010

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 It is now over 6 months old so the content may be out of date.

This week, we run the rule over a savings account, a credit card and a mortgage, all of which stand out in their particular field.

Best Buy Bond

Savers willing to commit funds for five years are being offered a best buy rate of 4.60pc from Birmingham Midshires. For those after a regular income, a monthly interest option is available. Up to £10m can be invested in the postal operated account, which is open to savers bringing new money to the provider. Further additions are permitted whilst the issue remains open. Earlier access to funds is allowed, but will be subject to a loss of up to 365 days' interest.

Verdict: It is good to see Birmingham Midshires expanding its fixed rate savings portfolio with the launch of this five year bond. At 4.60%, the bond is amongst the market leaders in its field and should prove popular with investors who prefer to use the postal channel. The fact that earlier access is permitted is a plus, but to gain fully from the high rates investors need to tie in funds for the longer term, as access penalties are hefty early on.

Sainsbury's strikes gold

The new Gold Credit Card from Sainsbury's Finance offers customers the opportunity to collect Nectar Points on everything they purchase with the card. Customers will earn two points per £1 in Sainsbury's stores and one point per £5 spent elsewhere. The card charges 18.0pc APR, which includes the £5 per month fee. No fees will be charged for cash withdrawals, foreign usage or balance transfers.

Verdict: This card may appeal to the frequent traveller or those wishing to benefit from a loyalty scheme. However, consumers will need to weigh up the monthly charge against the advantage of not paying for foreign usage or cash withdrawal fees. The waiving of these fees along with not charging for transferring a balance and not applying cash withdrawal interest if the statement is cleared each month make this card unique.

Market leading mortgage

Borrowers with a 20pc deposit, who are looking to fix their mortgage repayments for five years are being offered a market leading rate of 4.49pc from Norwich & Peterborough Building Society. A £995 product fee is payable to secure the deal and borrowers can make penalty free capital repayments of up to 10pc per annum, subject to a maximum of £10,000.

Verdict: This new offering from Norwich & Peterborough Building Society is competitively priced for those with a 20% deposit. The fee of £995 is on a par with many of its rivals and whilst some borrowers may be deterred by the lack of incentives, it is top of the direct business market. For borrowers looking for additional incentives to help reduce set up costs, other deals are available with higher rates to compensate.

Find the best savings rates for you - Compare savings accounts

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.