High street banks vs lesser know banks and building societies

dontpanick

Just wondering if there are any significant reasons why I should go with either of these options.

Currently looking into mortgages as I'm planning to buy. I have just a 5% deposit but a good credit record otherwise and interest rates with the building societies (e.g. Nottingham, Newcastle) seem to be noticeably less than the high street banks (e.g.TSB, Halifax) meaning i'd pay at least £60 per month more on my mortgage to go with a high street bank.

I know that interest rates aren't necessarily the be all and end all of the choice so I'm wondering if there's an obvious risk I should keep in mind?

ACG

Either are fine.
But you should look at what their turn around times are and document requirements. I use smaller lenders probably more than highstreet lenders and the vast majority are great, but some do make even the simplest of cases a nightmare.

cahillg81

Time scales with the smaller lenders can sometimes be an issue.


FWIW I like Nottingham and have never had any issue with them.

dontpanick

Thanks both, OK I'll keep that in mind. Long waiting times would be annoying but against a £60 per month saving, I'd probably put up with it.

Another concern is after the fix period is up, the SVRs are much steeper for smaller lenders, is there generally an issue with getting good retention products perhaps and ending up stuck on an awful SVR?

ACG

Not if you keep up your repayments and they are still actively trading. But assuming good history you can move to a new lender.

Boredatwrork

In most cases theres no reason anyone should be stuck on an SVR (cetainly not at the current rates), unless they choose to be, the lender will almost always have other products available, and/or there are other lenders.

Just keep up the monthly repayments, make over payments if you can and pay it off as soon as you can.