No ifs, its a great bank (Intelligent Finance)

Member Name: pipefish

Product:	Intelligent Finance
Date:	08/07/03 (1498 review reads)
Rating:

Advantages: no need to use banks, very good call centre support, offsetting saves you money

Disadvantages: no need to use banks, have to post cheques, there are slightly better deals about if you shop around

Banks eh? You specially get out of work in your lunch hour to try and visit them at a time they are actually open, have find a parking place in the middle of town and then are stuck in a queue for ages for one cashier while the person in front of you seems to have brought along their life collection of one pence pieces to put into their account, query their account for 20 minutes and slowly write out cheques that they could have easily filled in before being served. For this level of 'service' they pay you interest at 0.1% of the money that you leave with them, bombard you with junk mail for their overpriced credit cards, insurance and loans and also want to try and charge you to use their ATMs to get your own money out and will have no problems charging 'administration fees' for most things. To take their own catchphrase, wouldn't it be better if their was an easier way?

Well with Intelligent Finance there is, basically because they are internet and phone only so you will not have to visit a bank again! IF is a subsidiary of Halifax although they are independant from Halifax so you cannot run your account from high street Halifax branches.

I have been with IF for about 2 years now, gradually adding on more products on the way. I started with current account, savings account and mortgage, and am adding on a credit card too.
The various accounts are competitive, if not the very best deals about. The credit card is currently about 8-9%, the mortgage SVR generally tracks the base rate by about 1% and the current account and savings account are comfortably above the inflation rate (the savings account pays about 1% more). Base rate cuts are generally passed on the customers quickly or if not then they match the cuts from the bulk of other mortage lenders.

Setting up the plan is easy - I did the mortgage application over the web from their internet site to get a prelim offer and then various documents sent in to ge
t a w
ritten offer. Similarly the current account, savings account and credit card can then be added as 'jars' within your plan - most of the application you can complete over the internet, the confirmation details are then posted to you with a request to send some documents for proof of identity, address and income (bank statement, paycheck, utility bill etc). You get a Switch card for the current account, which can be used at most high street ATMs without a charge.

The internet service offers most of the features of other internet banks - you log on via the IF website and then you can set up bill payments, move money to other bank accounts, view direct debits, check your transactions and statements. Usefully you can also move money instantly between your jars, for example putting savings into the current account to stop it running over the overdraft limit, moving money at any time into the mortgage jar to make an overpayment, moving money into the credit card to pay the monthly minimum amount (this can also be set up automatically to pay the mimimum payment every month). This happens straight away, there is no wait of a few working days here, and no more sending cheques to your credit card company every month to avoid being charged £30.

The mortgage is amoung the best deals for flexible mortages - you can take up to 2 payment holidays a year and overpay when you want. As the interest is calculated daily this will have an instant effect on the interest payment.
I found the mortgage very pain-free to obtain - the valuation fee was free (although you do not see the results of the valuation), the surveyors on their list were actually the same ones my conveyancers recommended anyway and IF ASU and Building and Contents insurance cover is optional, there is no charge to use another provider for these. Most of the work involved obtaining a prelim offer over the internet, after that there were only about 5 phone calls and a few sets of do
cuments to sign and return.
There are better mortgage deals around although these will probably have extended tie-ins or redemption penalties, which the IF one doesn't have.
One thing to watch however is that there are several stealth charges if you want to remortgage with someone else; IF charge several 'administration fees' for releasing of deeds etc which worked out to about £150 the last time I checked in 2002.

Another thing to remember is that the mortgage offered calculates a set payment every month - making overpayments will not decrease this. Instead it decreases the amount of interest every month so that more of your repayment pays off capital on the loan, enabling you to pay off the mortgage earlier. Using your account on the web you can increase this payment to a new rate, but not decrease it.
Making overpayments will save you more money in the long term - up to about 2 or 3 times the value of the overpayment over 20 years (e.g. £1000 overpayment at compound interest rate of 5% for 20 years is £2653) and regular overpayments offer larger savings. These savings are much trumpeted about on websites for most of the current-account mortgage and flexible account websites but usually your savings will not be so great - generally most people cannot afford to overpay a mortgage regularly and also the effects of inflation over the term of the mortgage will reduce the actual saving and costs of repayments (this is why people who took out mortgages many years ago seem to be paying so little in todays terms).

The other advantage of having several jars is offsetting. Traditionally you would pay your credit card bills every month, and receive some interest on any money in your bank account. If you have £2000 outstanding on your credit card and £1000 in the bank this means you would pay about 8-18% of £2000 for interest on the credit card bills and get about 2-5% annual interest from the bank for your savings. With offsetting,
you can use the surplus in one jar to cancel out interest payments on another - in the above example it means you only pay interest on £1000 of the debt on the credit card - the other £1000 in the current account has been used to cancel out the interest owed on the £1000 on the credit card. This can also be used to cancel out some interest on the mortgage account as it is basically another jar in your plan with a balance of about -£80,000 or whatever. Again the savings are not as great as advertised here as most people will used any surplus money to pay off their debts anyway. However since this is done automatically it does save some interest payments and adding a large sum of money into your account (e.g. monthly salary) will automatically start working to cancel out interest payments on any debts owed.

IF also have phone support which is on an 0845 number and open 7 days a week. I have found this to be very good, there is very seldom much waiting in a queue to get through and there is only one automated voice menu to get though. For your account you need to give a contact number as well as your address, ideally a land line rather than a mobile.

You get a monthly A4 sized statement for all your jars within your plan. Logging on to your account on the web you can get the last months transactions at any time. Your jars in your plan are treated as separate accounts with their own balance and statements, you do not just get one transactions list and one balance.

The only main disadvantage is that paying cheques into your account has to be done by mail as there are no branches. These take 4-5 working days to process and clear into your account. Also if you do not have a broadband line you will have to pay internet call charges although the website is generally quite fast, especially given the level of security on it. Of course you can always use the phone instead to set up automatic transfers of money every month to pay off credit cards, swee
p money into savings accounts and read the monthly statements, check your balances etc. However you will probably need internet access to get the best of it.

So overall very well worth it, especially for the credit card as it gives a competitve APR and allows you take the most advantage of the ofsetting.

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