Full Service Banking
July 15th, 2007 at 9:29 am (Uncategorized)
There are a lot of kinds of bank accounts offered by banks as well as there are a lot of ways people arrange and repay their mortgages. But how often are the customers totally happy with the way their bank accounts and mortgage accounts are handled? Is there anything which can be done to improve the system? Some banks offer a new type of account – a single bank account. Let us summarize why this very type of account can be useful for you.
You save more money. Consolidating your income, borrowings and savings into one bank account, there occurs an opportunity for you to pay off the mortgage, if you have one, faster and on completely other conditions. This happens because when your savings and debts are put together it makes a cost of your borrowing lower.
Totally different set up of the loan facility. Opening a single bank account gives you the opportunity to negotiate an overall lending facility that can represent much more than the bank can offer when people run their finances in the traditional way, having a number of different accounts.
Different correlation of interest rates. The one account customers fund their mortgages at the same rate they get for their savings. Opening a single account you would not make a common mistake – like putting your money into one bank earning interest at 7% and then lend equal amount from the other bank at 10%.
The term of the mortgage can be cut. If you mortgage repayments are consolidated into the one account the moment they are made, you can pay off your debt much earlier, saving the money. And if your salary is paid into your mortgage account and it rises – you can afford to pay more of your loan and cut the term of the mortgage