Banks crowned cheapest mortgage lenders for 2002

Banks held on to their crown as cheapest mortgage lenders in 2003, with four banks in the top five and six in the top ten.

An annual survey of mortgage costs by financial products researcher Defaqto shows that for standard variable rates or their equivalent, Egg and HSBC were again in the top two spots respectively, with Nationwide in third place, followed by Intelligent Finance and Standard Life Bank.

The results were obtained by analysis of the amount of gross interest payable on a £50,000 interest-only loan.

The calculations exclude any special deals or privilege rates. If these were included, West Bromwich Building Society would be joint fifth, followed by Cheshire, and Skipton Building Societies.

Mark Hayes-Newington, group commercial director at Defaqto. Says: “An unchanged base rate and increased competition were good news for mortgage payers in 2002, particularly those able to take advantage of the many deals on offer. The mortgage market continues to fragment in product terms and this applies to variable rate products as well, making direct cost comparisons more difficult.”

He adds: “In terms of cost, variable rate mortgages were significantly less expensive in 2002 than in 2001 although the variability in cost between the most expensive and the least expensive was as great as ever.”