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UK's best and worst mortgage providers

Building societies fare better than high street lenders in a Which? poll

Terraced houses are seen in Liverpool, Merseyside, Britain.Building societies fared better than high street banks in a mortgage analysis done by Which? Photo: Carl Recine/Reuters
Building societies fared better than high street banks in a mortgage analysis done by Which? Photo: Carl Recine/Reuters (Carl Recine / reuters)

Building societies are outperforming high street banks when it comes to the tricky matter of providing a mortgage, according to consumer body Which?.

Nationwide Building Society (NBS.L) came out top in its yearly evaluation alongside Skipton Building Society and Yorkshire Building Society.

The consumer champion surveyed more than 3,400 members of the general public in July, with each provider receiving a customer score. Lenders with the highest customer scores have the best overall customer service.

In Which?'s scoring system, those with a rating of 70%+ count as great providers. Top providers according to Which? consistently offer table-topping mortgage deals across a range of product types and are fully covered by the Financial Services Compensation Scheme and Financial Conduct Authority (FCA) banking standards scheme.

Other building societies also fared well in the consumer champion’s analysis. Coventry Building Society and Leeds Building Society posted solid customer scores of 70% and 69%, respectively.

Meanwhile, some of the country’s biggest high street banks slipped further down the rankings compared with last year. Barclays (BARC.L), HSBC (HSBC) and Halifax received customer scores of 65%, 65% and 64%, respectively.

None of the firms managed to score above three out of five stars across categories including clarity of statements and flexibility of payments — two factors which may have taken on an increased importance for mortgage holders struggling with monthly repayments amid the cost of living crisis.

Read more: UK interest rates decision remains a tight call, says Andrew Bailey

At a time when average mortgage rates across a number of product types have reached their highest levels since the 2008 financial crisis, good quality customer service has become even more important.

At the bottom of the consumer champion’s analysis were Family Building Society, Kensington, the beleaguered Metro Bank (MTRO.L) and The Co-operative Bank for Intermediaries, all of which posted unimpressive customer scores in the mid-50s.

While major lenders may be able to offer a more extensive range of products than building societies, smaller lenders could provide more tailored products that better suit customers’ particular circumstances, such as first-time buyers with smaller deposits or the self-employed.

“With mortgage rates at some of their highest levels for 15 years and alarming numbers of homeowners struggling to meet their monthly payments, customer service is more important than ever," said Ele Clark, senior money editor at Which?

Watch: Mortgage rates climb to 7.6%