Consumer champion Which? is this month warning investors and homeowners to stay away from two financ...
Consumer champion Which? is this month warning investors and homeowners to stay away from two financial products it says do not live up to the advertising hype.
Barclays Openplan is one of a number of all-in-one products on the market that enable homeowners to reduce their mortgage payments by linking payments to credits already in current and savings accounts.
Which? says that better deals are available from flexible mortgage products, as long as the person taking out the mortgage is willing to switch at the end of the discounted period.
It also says that Barclays Openplan Moneymanager does not offer good rates of interest on money "swept" into higher-rate savings accounts.
Homeowners would require savings of at least £25,000 in order to enjoy a 3% rate, something that many ordinary current accounts offer from as little as £1.
The worst of it is that Barclays offers higher rates of interest to its Woolwich customers, something Which? describes as "disgraceful".
Halifax also suffers abuse because of the charges applied by its ShareBuilder service, which is supposed to target small investors.
The idea behind the service is to allow investors to put away a minimum of £20 on a monthly basis into selected shares, which can only be traded during a restricted number of days every month.
However, anyone investing the minimum £20 in the service is paying 7.5% in charges, which is far too much compared to investing in unit or investment trusts, Which? says.
Only people with, say, £1,000 should consider ShareBuilder, and then only on a one-off or short-term basis, Which? concludes.
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