The Nationwide has announced that it will be offering a 25 year fixed-rate mortgage. They claim it will be flexible and there would be no early redemption fees after 10 years. They will be charging a slightly higher interest rate compared to other, shorter term, fixed rate mortgages but with interest rates currently rising this might well appeal  to people who are concerned about the variability of costs for their mortgage in the future. It would certainly make financial planning for the future a lot easier.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)

The consumers association Which has carried out a survey asking people about bank chages which suggests that most people, 85%, who have claimed back their charges have had some success. The survey also found that many people were concerned  about how their bank might react if they were to claim a refund of charges and only one third of those surveyed had made a claim.

The banks are well aware how much their customers hate these penalty charges yet they seem to be quite unconcerned and happily attempt to justfy them though it is clear, to anyone hearing them speak, that they are being economical with the truth and very careful about the words they use. When asked a straight question, something like, “Is this the true cost of dealing with a defaulting transaction?”  they invariably refuse to answer. Perhaps the huge profits they make from them might be the reason? It seems odd since they are legally bound not to profit from these charges.

The Office of Fair Trading is expected to report soon after an investigation into bank charges. It is thought that they will recommend a maximum charge of £12 per incident as they did with credit card charges. When that limit was strongly advised to the credit card companies they winged loudly but all conformed. It might seem odd to an outsider that they chose not to continue charging the fees they previously charged since they always maintained that they were simply the cost of managing the defaulting transactions. Maybe they know something they don’t want to admit to? It couldn’t be that they know full well they were acting unlawfully by charging so much could it? I’m sure they are all honorable men, (and women), who wouldn’t dream of doing something so naughty.

It does seem strange that in what is supposedly a very competitive marketplace there are no banks that do not do something different. There is obviously a huge groundswell of opinion amongst bank customers that they don’t want to pay these charges and many of those customers might choose to support a bank that didn’t impose them or imposed them in a way that customers saw as fair.

Maybe asking a bank to be fair is an impossible dream?

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)

I watched a shocking tv programme last night. BBC1′s Whistleblower was an expose of behind the scenes footage at a Barclays Bank call centre and a high street branch. It also covered insider fraudulant use of bank accounts.
The programme was a remarkable view of what really goes on in the banking industry. A culmination of a 9 month investigation by BBC reporter Amanda Egbujo. Using secret filming it was shown that staff at the call centre were pressured into attempting to sell products to customers in complete disregard of genuine customer care and even legal guidelines.
Rather than admitting to being sales staff, call centre staff referred to themselves as “Account Consultants”. They were discouraged from being honest and giving good and sensible advice to customers as their priority was merely to sell.
I can vouch for this being a common practice from my own contacts in another bank. Honesty is considered bad practice and staff are told they should NOT advise customers to do anything other than purchase products. Read the rest of this entry

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)