Which? reveals best mortgage lenders as borrowers under stress

Saleha Riaz
·2 mins read
Chelsea Building Society came at the bottom of this year’s table. Photo: AP/Steven Senne
Chelsea Building Society came at the bottom of this year’s table. Photo: AP/Steven Senne

First Direct, Nationwide and Coventry Building Society have been rated the UK’s best mortgage lenders by consumer group Which?, as it revealed the impact the pandemic has had on borrowers.

Which? Surveyed more than 3,600 mortgage holders and looked at customer service, fee transparency and value for money among other factors, along with an analysis of thousands of mortgage deals.

First Direct had a customer score of 77%. It offered the highest number of cheap mortgage deals out of the 23 lenders reviewed, and achieved top marks for communication and online services.

Nationwide, with a 73% score, was popular with mortgage holders for its overall customer service and payment flexibility, while Coventry scored four stars for complaint and query handling. Its customer score was also 73%.

All three were given the Which? Recommended Provider label.

READ MORE: UK mortgage approvals hit highest level since 2007

Principality Building Society received a string of five-star scores in categories such as customer service and payment flexibility, but missed out on Which? Recommended Provider status as it did not offer better deals than its rivals.

Chelsea Building Society came at the bottom of this year’s table, with a customer score of 49%. Customers rated Chelsea only two stars for customer service, flexibility and value for money.

The specialist lender Kensington finished second from the bottom, while Atom Bank and Family Building Society were also rated two stars for customer service and clarity of statements.

According to Which?, one in five borrowers said they had contacted, or attempted to contact, their lender since the start of the pandemic and six in ten (61%) of those requested a payment holiday.

Of the first group, more than half (56%) reported having a problem, 29% said they had to wait on the phone for a long time, and 17% left a phone message but didn’t hear back. Twelve per cent emailed but also never heard back from their provider.

READ MORE: Boris Johnson promises biggest expansion of home ownership since the 1980s

Jenny Ross, Which? Money Editor, said: “Good customer service and communication have proven particularly vital since the start of the pandemic, so prospective buyers and remortgagers should factor them in as two of the most important aspects of choosing a mortgage, along with getting a good deal.”

Meanwhile, mortgage applications in the UK have surged to a 12-year high as house prices rose at the fastest annual pace since mid-2016, mortgage lender Halifax has reported.

And earlier this week prime minister Boris Johnson promised a scheme to allow first-time buyers to get a mortgage with just a 5% deposit.

Watch: What do stamp duty cuts mean for buyers and house prices?