Insurance Overview

1. Credit Lending 

Norwich & Peterborough offers LTV (loan-to-value) mortgage rates up to 80%, comparing favourably with the FSA’s Turner Review suggestion of a maximum LTV of 90%, i.e. the borrower should have at least a 10% deposit. It does not specify a LTI (loan-to-income) rate. The Turner Review’s suggestion is 3.5 times gross annual income. The building society states that it uses an affordability calculator to establish how much can be borrowed, however, this system does not come with clearly defined limitations on the amount of credit available. 

The building society uses both credit scoring and credit reference agencies to assess mortgage and personal loan applicants and customers are informed of these checks on application. 

2. Debt Warning

The building society uses a generic warning with regard to mortgages: ‘Your home may be repossessed if you do not keep up repayments on your mortgage’. No warnings as to the consequences of payment default for personal loans were found.

It does not refer customers to the FSA’s Debt Test or any equivalent service, though it does refer them to the FSA’s Customer Information and Money Made Clear websites. The debt test is designed to help customers find out whether they have, or are likely to have, problems with borrowing. It does offer access to a ‘budget planner’ for existing customers experiencing financial difficulty. 

3. Debt Management and Advice 

In their leaflet ‘A Guide for Customers in Arrears’ the building society set out what it will do to help customers experiencing financial difficulties. This includes:

• Contacting the customer to discuss their financial problems
• Talking to a free debt advice agency on their behalf on request
• Looking at possible changes to the customer’s existing payment plans 

It also clearly sets out the stages leading up to and after repossession. It states that before repossession it will give the customer ‘advice about getting in touch’ with their local authority with regard to re-housing. The extent of this advice is not illustrated, i.e. whether the building society provides customers with contact details or actually liaises with organisations on their behalf.

The society offers a basic bank account to anyone over the age of 16.

The society states that all its branches are accessible for disabled people. Its website also offers some accessibility options to disabled customers.

Norwich & Peterborough states that it does not lend to disadvantaged communities at preferential rates as a general rule, but in the past has lent at a favourable rate to charitable organisations.

As a building society, NPBS does not fund microfinance projects.

The society addresses the key issues of energy efficiency and waste management in its environmental policy. This does not contain information regarding the society’s long-term commitment to improved environmental performance however.