Monday, 28 February 2011

The number of complaints to ombudsman rise by 15%

Complaints to the ombudsman about financial services rose by 15% in the second
half of 2010 compared with the first half of the year.
Lloyds Banking Group topped the complaints list, the ombudsman said, although it is the UK's largest bank.
The figures, which cover complaints about banks, insurance and investment firms, showed the ombudsman service had received 97,237 new queries.
This list only covered those complaints which required mediation.

The ombudsman upheld 53% of complaints in favour of consumers in the second half of 2010, compared with 44% in the previous six months.
That increased success rate for complainants was identical to the rate recorded in the second half of 2009.
Separately, banks are also publishing data on their websites about all their complaints for the same six-month period.
These figures will cover customer gripes which were dealt with, as well as any unresolved cases that went to the ombudsman.
This data will be collated by the Financial Services Authority (FSA) and will be published at the end of March.
Complaints going to the ombudsman were again dominated by worries over the sale of Payment Protection Insurance (PPI).

Most complained about groups

  • Lloyds Banking Group: 22,181 (22,420 in previous six months)
  • Royal Bank of Scotland: 8,644 (6,469)
  • Barclays: 8,256 (9,215)
  • HSBC: 8,238 (4,031)
  • Santander: 6,759 (5,372)
Source: Financial Ombudsman Service. New complaints July - Dec 2010 (new complaints in Jan - June 2010 in brackets)
These accounted for more than half of the new complaints received by the ombudsman in the second half of the year.
The largest banking groups headed the complaints list.
There were 22,181 complaints about Lloyds Banking Group, of which 12,234 were specifically about Lloyds TSB - the most of any single business.
Five financial services brands - Lloyds TSB, Royal Bank of Scotland, Barclays, HSBC and Santander UK - had more than 6,000 complaints about them received by the ombudsman.
"The latest set of complaints data continues to show that while some financial businesses are improving the way they handle their customers' complaints, some regrettably are not," said chief ombudsman Natalie Ceeney.
"Taking the trouble to handle complaints well is an important part of a business's ongoing relationship with its customers - and it is the key to providing really excellent customer service."
The ombudsman accepted that the size of the business would affect the complaints levels.
However, when it consulted with experts on how this should be taken into account in the figures, they disagreed, so the figures are published in their raw form with no adjustment for size.
Of the large banking groups, there were increases in complaints to the ombudsman from customers of Royal Bank of Scotland, HSBC and Santander, compared with the first six months of the year.

It's Vitually Impossible to Remortgage

Home owners with equity of less than 15 per cent are finding it virtually impossible to find a new mortgage, new figures suggest.

The exclusive data, based on more than a quarter of a million remortgage valuations since 2007, reveals the full extent of the difficulties facing home owners looking to secure a new home loan.
At the height of the property boom in 2007, home owners did not need any equity in their homes to remortgage, with one in 20 borrowing more than the actual value of their home. It meant the money raised could be used for home improvements.
However, not only is now impossible for those already on the property ladder to strike the same deal, but they will need a deposit of at least 15 per cent.
Banks and building societies imposed strict lending criteria after the credit crisis and there are no signs that the trend is easing.
Lenders are demanding increasingly bigger deposits, with the figures from e.surv showing that half of all people who remortgage their home have equity of at least 25 per cent. It compares with just 19 per cent of people at the peak of the housing market in August 2007.
Today, 42 per cent of home owners who are looking for a new deal have equity of at last 40 per cent.
Just 8 per cent have a deposit of at least 15 per cent, compared to more than double that percentage at 21 per cent in August 2007.
Rising unemployment means lenders are concerned about borrowers’ ability to meet their monthly mortgage payments and are restricting the best deals to those with the largest deposits.
For many home owners, this has not been a problem as they have automatically slipped onto their lenders’ cheap standard variable rates at the end of their initial deal.
But with speculation that the Bank of England will raise interest rates as soon as next month, borrowers are keen to guard against an increase in their monthly payments by locking into a fixed rate.
The latest figures from the British Bankers’ Association showed an increase in the number of people remortgaging in January.
Richard Sexton, sales director at chartered surveyor e.surv, said: “With the Bank of England poised to raise interest rates, we expect a growing scramble from home owners to remortgage.
“But the best deals are not available to those who arguably need them most. For the last year and a half almost no-one needing more than 85 per cent loan-to-value has been able to refinance their loan, and the proportion of loans going to those needing between 75 per cent and 85 per cent loan to value has shrunk from a quarter to just one seventh.
“Only those with the lowest loan to values can be sure of securing the best deals. These are usually older, wealthier people. Because people in more expensive homes tend to have much more equity, built up as they traded up the property ladder, they can be much more certain of grabbing the cheapest rates. Younger borrowers who still have larger mortgages on cheaper homes are finding it much more difficult.”

Saturday, 26 February 2011

Small Businesses Struggle for finance !!

Small businesses in the UK are still struggling to access finance, according to one expert.
Ed Moss, a spokesman for the Manufacturing Institute, has claimed that the age-old problem "has not gone away".
The comments coincide with the launch of the European Commission's EU-wide Small Business Act, which aims to improve smaller enterprises' access to finance.
As part of the Act, public authorities will be required to pay suppliers within 30 days, which should improve the cash flow of businesses.
However, Mr Moss added that small business owners have learned to take bank's "glossy statements" with "a pinch of salt".
"They are still having trouble finding finance; the banks are not yet lending," he explained.
"Of course, it's the smaller guys that unfortunately suffer when it comes to producing the goods – they send them out, they've been delivered and then, of course, they're chasing the money. So cash flow is still a problem; it has not gone away."

British Economy falls even further!!!

The British economy shrank even more than first thought in the last three months of 2010, official data showed, sending alarm bells ringing about the recovery.

The new figure signals that even with the impact of the weather stripped out, the British economy did not just grind to a halt, but actually contracted 
Gross domestic product (GDP) fell 0.6pc quarter-on-quarter, the Office for National Statistics (ONS) said, a bigger drop than its initial 0.5pc estimate that had shocked markets.
The new figure signals that even with the impact of the weather – still put at a 0.5 percentage point hit – stripped out, the economy did not just grind to a halt, but actually contracted.
"The figures underline that the UK recovery is bumpy and that a return to pre-credit crunch, solid, consistent growth is by no means yet on the cards," said Charles Davis, managing economist at the Centre for Economics and Business Research.
The data lent weight to the argument that a rise in interest rates should be postponed, despite inflation having hit double the target at 4pc.
Adam Posen, the Bank of England rate-setter who wants conditions to be even looser, argued that inflation will not stay a problem for long, as pay growth will be "very low" for a couple of years.
On Friday money markets were factoring in a rise in the Bank Rate from its 0.5pc low by June, compared with recent expectations for a May move.
Economists had generally expected the GDP figure to stay unchanged. The ONS said the revision was mostly due to the huge but sluggish services sector, with retailers and business and financial services companies suffering more than first thought.
George Osborne, the Chancellor, said the data "didn't change the fact" that the fourth quarter disappointed, but Ed Balls, Labour's Shadow Chancellor, said it confirmed that the recovery has "stalled" and that the UK needs a change of course.
The GDP breakdown in terms of spending showed that only government outlay made a positive contribution to the economy, rising 0.7pc quarter-on-quarter.
This support from the state will prove to be shortlived and raises concerns about the cuts programme, said economists.
Stuart Green, an analyst at HSBC, said the surge "clearly questions both the degree of progress made on fiscal consolidation and how the economy will perform once the bigger squeeze begins around the middle point of this year".
Net trade kept dragging on growth, as imports grow faster than exports. Business investment, intended to be the other prong of the UK's growth strategy, fell 2.5pc, although companies kept growing their cash piles, suggesting caution was stopping them investing.
Last year's GDP peak was also revised downwards – again – from 1.1pc to 1pc growth in the second quarter. For the year as a whole, growth was just 1.3pc.
The British Chambers of Commerce said the data flagged up the need for next month's Budget to offer policies that support growth.
Meanwhile, Paul Fisher has been reappointed for another three-year

Friday, 25 February 2011

Lowest Loan rates for over 2 years

The lowest personal loan rate in over two and a half years was launched today, though many applicants won't qualify for it.
M&S Money has today launched the market's first sub-7% loan since June 2008, according to price comparison site
It has cut the rate on loans of £7,500 to £15,000 from 7.5% to 6.9%.
However, huge swathes of applicants may be unable to get the best rate on this or any other top deals.
This is a result of EU rules that came into force on 1 February, which gives consumers less protection than they previously had.
Providers must now offer published rates to at least 51% of successful applicants rather than the previous requirement to offer them to at least two thirds.
M&S has confirmed a minimum of 51% of successful applicants will be offered its best rate but says it is not yet clear how many successful applicants will get it.
Only those with good credit records will qualify for the top deals.
Dan Plant, money analyst, says: "Loan rates have been inching down, and breaking the 7% barrier is encouraging.
"Yet it's possible cheap rates are only appearing because lenders don't have to give them to 49% of successful applicants."
Meanwhile, research shows typical £3,000 and £5,000 loan rates are at their lowest levels since 2009 and the average £7,500 rate is at a two-and-a-half year low. reveals the average rate on a £3,000 loan is 14.39% (it was last lower in November 2009 at 14.16%). The typical £5,000 loan rate is 10.2% (9.91% in June 2009), while the average £7,500 loan rate is 7.58% (7.53% in July 2008).
However, rates are still some way off the pre-credit crunch lows. In November 2007 the typical £3,000 loan rate was 10.6%, the typical £5,000 loan rate was 7.41% and the typical £7,500 rate was 6.7%.

Thursday, 24 February 2011

Interest Rise more and more probable


Interest rates could rise after Bank of England chief economist Spencer Dale changes stanceInterest rates could rise as early as March after the Bank of England revealed that this month's meeting of policy makers as its most hawkish in years.

The pound rose more than half a cent against the dollar to $1.6238 after it emerged that Spencer Dale, the Bank's chief economist, had joined those calling for an immediate rate rise. The minutes from this month's meeting of the Bank's Monetary Policy Committee (MPC) also revealed a hard swing towards higher rates among the neutral members on the committee. "Some thought that the case for an increase had ... grown in strength," the minutes said.
Mr Dale is the first internal Bank member to break the house line that rates should remain at their current historic low of 0.5pc for the time being, and it was the first effective 6-3 split since July 2007.
Andrew Sentance has been calling for a rate rise since June and pressed harder this month by voting for an increase to 1pc. Martin Weale repeated his January call for a 0.25 percentage point rise, a position now backed by Mr Dale. At the other end of the spectrum, Adam Posen again voted for an extra £50bn of quantitative easing.
Interest rate futures nudged up two basis points after the minutes were published, suggesting the markets are more confident than ever about their predictions for a May increase. However, Simon Ward, Henderson's chief economist, said: "The minutes suggest that Bank Rate will rise in two weeks' time if revised fourth-quarter GDP figures and surveys for February indicate that economic recovery is continuing."
Despite the bullish tone, the minutes cautioned that "there was merit in waiting to see how indicators of how the economy performed at the start of the year to help assess whether or not the decline in GDP in the fourth quarter presaged sustained economic weakness".

Wednesday, 23 February 2011

Mortgage approvals still low

LONDON (SHARECAST) - The number of mortgages approved last month was down 21% from January 2010, as conditions in the UK housing market continue to be subdued.

Just 28,932 loans were approved for house purchases over January, according to the British Bankers’ Association (BBA).
While this was slightly up from the 28,907 approved in December, it remains below the 36,555 approved a year before, and well under the 70,000-80,000 level considered to be a reflection of a stable housing market.
“We are seeing little change in the borrowing environment for households or businesses at the start of 2011," said the BBA's statistics director, David Dooks.
"In both unsecured borrowing and company finance, the emphasis is on repayment rather than new borrowing."
The average value for mortgage approvals was £135,000, 2.7% lower than January 2010.
Remortgaging loans saw a steady expansion over 2010, with 26,109 loans approved in January, 28% higher than the 20,407 approved the previous year.
Net mortgage lending, which does not account for redemptions or repayments, grew 75% over the month to £1.6bn, from £0.91bn in December, as a result of the poor weather in December, which delayed many home purchases.

While this is a considerable increase, the monthly figure in December was the lowest since June 1999, and lending in January remained substantially below the £2-3bn level seen in 2009.

Interest Rates: An other one join in for the rise

Minutes for the Bank of England’s latest meeting could reveal another policymaker crossed the floor to vote for interest rates to rise, increasing the momentum towards tighter lending conditions. There is fierce debate among Bank policymakers about the path ahead. Even if the split stayed the same, the minutes of the February gathering are expected to show a shift in sentiment among the nine-strong Monetary Policy Committee towards a rate rise sooner rather than later.

Governor Mervyn King referred to “real differences” in the MPC’s views when he presented the Bank’ quarterly inflation report earlier this month, fuelling speculation of a deepening divide.
The nine members of the committee are divided as to whether to raise rates now, to stop expectations that prices will continue to rise getting entrenched, or hold off from a course of action that might threaten growth, given that the full impact of government austerity measures have yet to hit.
The previous meeting saw Martin Weale join his colleague Andrew Sentance in voting for a rate rise, while the other seven MPC members, including Mr King, kept voting for no change.
Adam Posen, at the “dovish” end of the MPC, was the lone voice calling for further easing of conditions, via more quantitative easing, on top of keeping rates at their record 0.5pc low.

Monday, 21 February 2011

Warning about fixed rates !!!!

Nationwide Building Society is warning home owners to ignore calls from mortgage brokers to rush out and sign up to a fixed-rate mortgage.
'Think twice before you rush to get a fixed rate mortgage' 
The dilemma for home owners over whether to fix their mortgage sooner rather than later intensified last week. Higher than expected inflation numbers raised the prospect of an interest rate rise before the summer, with economists expecting more increases to follow before the year was out.
But Chris Rhodes, Nationwide's product and marketing director, warned that mortgage brokers had the incentive of their fees to urge borrowers to fix. Business for many brokers has been tough, with the number of mortgages taken out at low levels.
Mr Rhodes said the decision to fix was not clear-cut. "Churning mortgages gets them [brokers] a fee," he said.
Lenders price fixed-rate deals according to so-called swap rates, which are the rates at which banks borrow in the market – these loans are not priced directly on Bank Rate. Over the past few weeks the market has been factoring in rate rises and so swap rates have risen. Consequently fixed-rate mortgages have become more expensive.
If Bank Rate does rise, so will swap rates, and mortgages will become even more expensive.

Saturday, 19 February 2011

Inflation creates shock and enigma for investors and Borrowers

Inflation may be a world away from its dizzy peak of 29pc in 1973, but it is going up and people will be starting to feel the pinch. The question is: how can people deal with the prospect of rising inflation?

Home owners

Rising inflation raises the prospect of a rise in interest rates - and this is the conundrum for property owners. Should they opt for a fixed rate now or wait? Their dilemma is worsened by the prospect of falling house prices. As prices fall, the amount of equity they have in their home reduces. The difference between having 30pc equity and 10pc equity can be as much as three percentage points on your mortgage rate.
An imminent rate rise didn't seem a probability a couple of months ago. But higher-than-expected inflation has put a spanner in the works and now some reckon a rate rise this spring is a distinct possibility. "Swap" - or wholesale - rates have ticked up, suggesting that the market is anticipating a rate rise. Some providers have withdrawn their best deals from the market in recent days.
If it's peace of mind that you are after, then opting for a fix now could be the best move.
"Those who are not so heavily geared [i.e. have plenty of equity] with their mortgage and have sufficient disposable income may find it worth gambling on interest rates staying low," said Mark Harris of Savills Private Finance, the mortgage broker.

Thursday, 17 February 2011

Savers make losses of £400 per year beacuse of Inflation

Savers are effectively losing £400 a year due to the rising cost of living, new figures have revealed.
Official figures showed the Government’s preferred measure of inflation, the Consumer Prices Index, rose to 4 per cent in January amid higher oil prices and the increase in Value Added Tax.
The rise means a basic rate taxpayer with £10,000 in a typical instant access savings account paying just 0.67 per cent earns £53.60 a year net, but effectively loses £400 once inflation is taken into account. It produces a total net loss of £346.40 in a year.
For a higher rate taxpayer, the net loss is equivalent to £359.80, according to the calculations by personal Moneynet. Savers have seen a better rate of return on Individual Savings Accounts, where the average interest rates have risen to 2.34 per cent, the highest since January 2009.
But experts warn that the increases are of little comfort to savers at a time when inflation is rising at such a fast rate. .

Wednesday, 16 February 2011

Energy Companies fail to provide Annual Statements

Households are left in the dark about energy bills as more than 60pc claim not to have received an annual usage statement, despite new compulsory new rules by regulator Ofgem.
All households were to receive an annual statement by December 1 last year depending on their supplier's billing cycle. The statement details each household's current energy plan, yearly consumption and predicted bill, any discounts that are available and advice on how to change supplier.
The research by comparison site highlighted potential design or layout flaws that could be making it difficult for customers to identify an annual statement and to use the information to make informed choices, as Ofgem had intended.
Ann Robinson, director of consumer policy at uSwitch, said: "Annual statements are a linchpin of Ofgem's push to get the competitive energy market working properly, but consumers clearly don't think they are coming up to scratch.
"The statements appear to be poorly labelled, difficult to understand and do not stand out from ordinary energy bills. As far as consumers are concerned, annual statements as they currently stand are not fit for purpose."
Marie Clair, spokesman for the Plain English Campaign which argues the need for clearer bills, said: "Annual energy statements are confusing and inconsistent. Suppliers have fallen into the trap of using language that is familiar to them but unclear and often meaningless to the consumer.
"There needs to be consistency in the way suppliers present the information and the language they use. Common sense would suggest that the best bits are taken from all the suppliers and pulled into one standard format adopted by all. This would really benefit consumers and turn annual statements into a meaningful and useful piece of communication."
Energy UK, which represents suppliers, attributed the delays in statements to the volume of customers.
"With 26 million homes in the UK, this has been a huge undertaking. Those who have not yet received their annual statements should get them soon," he said.

Mortgage Deposits at an average of £31.500 for first time buyers

The typical deposit stood at £12,700 at the start of 2007, but rose to £31,500 by the second half of 2010, the Council of Mortgage Lenders has said. The average age of a first-time buyer now stands at 37.
The figures were released as housing and lending bodies faced government calls to help first-time buyers.
And the misery is likely to continue. There was no "magic bullet" that would fix the mortgage market and remove the problems faced by first-time buyers, the head of a lending trade body said.
Michael Coogan, the CML's director-general, said that while mortgage insurance, shared ownership and product innovation could all potentially play a part in improving the mortgage market, there was no "magic bullet" that would normalise it.
Instead, he said returning to a normal market was likely to be a gradual process, as confidence in funding markets and lending decisions was gradually restored.
Total mortgage advances during 2011 were expected to be just £135 billion, less than half the £363 billion advanced in 2007 before the full impact of the credit crunch was felt.

Tuesday, 15 February 2011

Inflation hits 4pc, Double the Target!

Inflation surged to double the Bank of England's target in January, increasing pressure on the central bank to raise interest rates.
The increase in VAT to 20pc and rising oil prices were behind a jump in inflation in January 
The jump, which was driven by higher oil prices and the recent increase in value added tax (VAT), is the biggest in more than two years, according to the Office for National Statistics.The rise - correcly forecast by economists - means CPI inflation has been at least a percentage point above the Bank of England's 2pc target for more than a year.
"This is another kick in the teeth on the inflation front for the Bank of England, albeit slightly less hard than some had feared," said Howard Archer, UK economist at IHS Global Insight. "It maintains pressure on the Bank to retaliate by raising interest rates sooner rather than later.
Mervyn King, the Bank of England's governor, continued to blame the "temporary effects" of factors such as the increase in VAT at the start of the month, the fall in the pound and soaring commodity prices.

Financial Crisis has hit those aged 50 to 60 the most

The report, published by the Saga group, found that the generation coming up to retirement have been effected badly by the rising cost of living, unemployment and a fall in savings.
While many of those who have already retired are enjoying decent pensions and have paid off their mortgages, those in their 50s are enjoying no such peace of mind, the report makes clear.
The study included a survey of 13,000 people over the age of 50 as well as a detailed analysis of Office for National Statistics data, undertaken by the Centre for Economic and Business Research, a think tank. It laid clear the concerns and problems facing the so-called baby boomer generation born between the end of the war and Harold McMillan declaring that Britain had never had it so good.
The study found that the annual real disposable income – taking into account inflation – had fallen from £34,366 a year ago to £33,900, or those between 50 and 64, an annual fall of more than £450.
Ros Altmann, the director general of Saga, and former government pensions adviser, said: "Inflation has really hit those who have yet to retire. They tend to still drive a lot, they still need to heat their homes, and they may still have a mortgage.

Monday, 14 February 2011

Mortgage Rates 'becoming more expensive'

 Fixed rate mortgages have become more expensive in recent months as the markets "overreact" to potential interest rate rises, brokers say.
The cost of borrowing for mortgage lenders - known as the swap rate - has risen, which has pushed up fixed-rate deal costs in recent months.
This swap rate has risen because of an expectation of UK interest rate rises later in the year.
The Bank of England has again frozen the Bank rate at 0.5%.
The rate has remained at this level since March 2009.

There are two key factors to the prices of home loans, according to Ray Boulger, of mortgage broker John Charcol.
The Bank rate - currently at a record low of 0.5% - dictates short-term costs of rates.
However, the swap rate is more significant for longer term fixed-rate mortgages as it is based on where interest rates are expected to move in the future, Mr Boulger says
There is widespread expectation of a Bank rate rise later in the year, and this is pushing up the cost of fixed-rate deals.
But Mr Boulger said that this rise in home loan costs might not last if it turns out that the markets have overstepped any forthcoming changes.
"If the Bank rate fever dies down a bit, the costs [of fixed-rate deals] could come down later in the year," he said.
Melanie Bien, of mortgage broker Private Finance, said that the markets had been "overreacting" to potential rate rises and this had been reflected in the growing costs of fixed-rate mortgages.
The movements of the swap rate were difficult for borrowers to understand when the Bank rate remained steady, she said.
But she stressed that there were still very competitive deals available, with some five-year fixed-rate deals starting at 4%.

Tuesday, 8 February 2011

Late payments of bills is at three years high

Payments in the final quarter of 2010 bucked the slowly improving trend for the year by rocketing 16pc to an average of 25.7 days late, the information services company said.
Payments are "timely" indicators of company health and banks will scrutinise the data to inform lending decisions. They may respond by tightening credit conditions for small companies further.
Jason Mills, from Experian, said: "More businesses – even financially strong ones – struggled with short-term cash flow issues towards the end of last year. These businesses are likely to have been affected to some degree by the bad weather, with many companies unable to operate at full efficiency as employees struggled to get into their offices."
Large companies turned the screws on suppliers, paying their bills 36.7 days later than agreed terms, up from 35.9 days in the final quarter last year. But small companies recorded the largest increase in their late payments, taking on average more than 22 days to settle invoices – three days longer than the same period last year.
Andrew Cave, spokesman for the Federation of Small Businesses, said: "Late payment is the elephant in the room and it's why so many businesses are forced to go to the banks for funding, in forms of overdrafts, Loans or credit cards. It is used as a safety valve by businesses in trouble. The first thing they will do is delay payments. If it's building up that's a concern."

Saturday, 5 February 2011

Debt Problems

The record number of personal insolvencies for the whole of 2010, which was double the number in 2005, came despite a drop in the final quarter of the year when 30,729 individuals were declared insolvent.
Experts suggested this fall at the end of the year was the result of fewer people being able to attend court proceedings owing to the weather, a more sympathetic attitude from lenders, and people putting off insolvency until the new year.
Insolvencies throughout 2010 were driven by a 6.5% rise in Individual Voluntary Arrangements (IVAs) - which allow an official deal to be struck between the debtor and creditors - to 50,716. One of  the Debt Management Solutions.
There were also 25,179 Debt Relief Orders - a relatively new style of insolvency for relatively low debts.
However, the number of people taking the more traditional bankruptcy route fell by 20.7% compared with 2009 to 59,194

Wednesday, 2 February 2011

Homeowners cannot be able to benefit from low rates despite base rates of 0.5%

Millions of hard-pressed homeowners are failing to benefit from low interest rates as banks and building societies charge mortgage rates of up 12 times Bank of England base rate.

This has left many borrowers paying standard variable rates (SVRs) of up to 6%, even though base rates have been slashed to just 0.5%.
Instead of cutting their SVRs, lenders have been lifting them instead. High street giant Halifax recently hiked its SVR for new customers to 3.99%, up from the 3.5% paid by existing borrowers.
It isn’t the first major lender to punish borrowers in this way. Last year, Lloyds TSB and C&G hiked their SVRs for new customers to 3.99%, way above the 2.5% paid by existing customers, as Nationwide had done earlier.
Skipton building society was last year’s worst offender, lifting its SVR from 3.5% to 4.95% for all mortgage customers. This cost a borrower with a £100,000 mortgage an extra £121 a month.