Two in five mortgage holders who changed banks after moving home did so to secure a better mortgage deal, research from the Current Account Switch Service has found.
The survey of 2,000 UK adults who had moved home, either as tenants or buyers, within the previous two years found that 41% of mortgage holders who switched banks wanted access to a better mortgage rate. A further 30% moved to obtain an incentive linked to their mortgage.
Only 15% of home movers switched their bank account during the move, compared with 46% who changed broadband provider, 38% who switched energy supplier and 35% who changed mobile phone provider.
Although 53% of consumers spent an average of five hours researching different aspects of their move, only 22% looked into current accounts or other banking options. This compared with 50% who researched local property prices and 48% who considered energy suppliers and broadband providers.
YOUNGER MOVERS MORE LIKELY TO REVIEW BANKING
Younger people were considerably more likely to reassess their banking arrangements while moving home. Half of those aged 18 to 24 and 51% of those aged 25 to 34 reviewed or considered switching their current account, compared with 30% of people aged 45 to 54 and 19% of those aged over 55.
The difference was also reflected in completed switches. Some 22% of 18 to 24-year-olds changed bank account, more than two and a half times the 8% recorded among those aged over 55.
However, 67% of over-55s said they would not normally consider reviewing their bank account during a move, compared with 25% of 18 to 24-year-olds.
Overall, 58% of home movers did not review or consider switching banks as part of the process. Of that group, 32% did not realise it was something they should consider.
RATES AND FINANCIAL TOOLS INFLUENCE SWITCHES
Among mortgage holders who switched banks, 41% wanted access to customer-only deals and mortgage rates. Some 30% sought a mortgage-related incentive, while 28% wanted higher interest rates on their deposit.
Additional perks were cited by 41% of switchers. Better budgeting or money-management tools and the opportunity to consolidate accounts were each cited by 29%.
The Current Account Switch Service advised consumers to seek financial advice from existing and prospective lenders before changing bank accounts.
John Dentry, product manager at Pay.UK, which owns and operates the Current Account Switch Service, said: “Moving home is one of life’s more stressful milestones, and at a time when every pound counts, consumers need to be unlocking all the help they can get.
“With rates well above the low figures of a few years ago, taking time to compare current account options alongside mortgage arrangements can make a real difference, as could extra interest on your deposit, improved financial planning tools and tailored mortgage advice.
“As the backbone of your finances, you should take your choice of banking provider seriously and ensure your current account is meeting your needs and goals. If you decide to switch, it won’t add any burden or cost.
“You simply pick a new bank or building society, request a switch, and we’ll do the rest within seven working days. It could be the easiest move you make.”
