The less scrupulous mortgage lenders are those who try to sucker you in with a very low interest rate but are using it to trick you into paying in other ways – for example for their higher insurance premiums.

And they’ll trying to force you to stay with them by charging nasty penalties if you leave – say after they’ve decided to raise your interest rate to unreasonable levels because they feel like pleasing their shareholders.

 

The best type of mortgage lenders

… are those who charge a reasonable interest rate and don’t try to tie you in. Why not? Because they understand customer inertia and know that most of us stay with our mortgage lenders or bank anyway.

They know that most of us will buy their insurance policies because we can’t be bothered to save “only” a hundred pounds a year by shopping around. That’s if they’re actually bothered about making a profit.

Unlike the PLCs, Building Societies do not have the huge pressure of making profits to pass on to their shareholders… They like to make a profit. But they don’t have the same pressure that the likes of Enron used to think was a good thing. Ask yourself whose side your lender will be on. Their borrowers – ie you – or their shareholders?