Why is Halifax offering such high rates on 3 month term accounts (6.95%)?

someone

Just been looking at the rates on Halifax's website and noticed this

http://www.halifax.co.uk/savings/fixedwebsaver.asp

To lock your money up so to speak for 3 months they will give you a rate of 6.95%. Now, I know at the end of 3 months they could just say the rate if you want to lock it up is 4.5 or something but is strikes me as strange that is so much higher than the bank of england rate and instant access accounts. Also the longer you lock your money away for the less attractive the rate

worrypants

Dont know and dont care as I got mine in just over a week ago and they have dropped the rate already within the last week mine was 7.05%
so act fast before rates go down a bit more

Ems!

someone wrote: »

Also the longer you lock your money away for the less attractive the rate

I don't know about why the rate is what it is, but the reason that you get a lower rate if you lock in for longer will be because the banks "think" the interest rate will go down over time so they don't want to commit to x years at such a high rate.

[Deleted User]

Because like all banks, they are completely skint and need to bring the money in. RBS and barclays are rumoured to have especially needed cash from the BOE recently, northern rock is now apparently topping 57 billion from the BOE.

I had a credit card with halifax two years ago and a 15K limit, now im a lot better off and all they will give me is not much more then 4K. Thats the difference, they are brassic! (sorry I cant spell lol)

ManAtHome

Bank's not too keen on lending to each other at the moment so they're having to offer high rates - quite a few offering 6.5% or over for anything up to 3 years.