Mortgage Overview
A mortgage is the biggest loan most people will take out in their lifetime. But just how is this loan funded?
Who else does your mortgage provider do business with? Might they also lend to big corporations involved in areas you don't approve of? Do they lend responsibly to their customers and offer assistance to those who fall into financial difficulty? Do they offer incentives to environmentally-sound projects?
If you're thinking of buying property or your existing mortgage is up for renewal, this section will help you find a green and ethical provider.
Find out about your current or prospective provider
What are the green and ethical options?
Find out about your current or prospective provider
Use the mortgage search to find out more about your current or prospective mortgage provider's green and ethical credentials. Key areas considered are responsibility toward customers, financial exclusion, equal opportunities, environment and also whether they have an ethical lending policy or guidelines in place.
Responsible lending
The importance of responsible lending cannot be overemphasized. The recent global economic downturn is often attributed to the 'sub prime crisis'. This refers to the granting of loans to people who are considered to be in higher risk categories - those more likely to default or who have a poor credit history, for example.
This type of lending is not problematic in itself - credit unions and community development finance institutions regularly lend to sub prime candidates.
Instead, irresponsible lending to customers in the sub prime category is the problem. In the build up to the crunch some financial institutions were lending 100% mortgages (and in some cases more) to people who would not be able to make their repayments in the long term.
Key questions to ask: Does your bank have responsible lending policies that ensure that its products are targeted in an appropriate manner? And does it provide advice or debt management services to customers who fall into financial difficulty?
What are the green and ethical options?
- Co-operative Bank: has a well-recognised ethical policy in place that governs all its lending decisions and products including mortgages. It also offers a specific Green Mortgage and re-mortgage product. Additionally it offers a reduced-rate loan to mortgage customers wishing to purchase and install energy efficient home technologies from an approved list.
- Ecology Building Society: has an 'ecological' lending policy which applies across all lending practices. It offers a number of green mortgage options.
- Norwich & Peterborough Building Society: offers a Green mortgage which plants 40 trees per mortgage and available for new homes with a Standard Assessment Procedure (SAP) rating of 100 or higher or to those looking to make their home more energy efficient. It also offers a Brown mortgage which includes a free energy survey and advice on making property energy efficient.
Your next steps
Check out our Next Steps Guide - Mortgages for suggestions on how to find the right green and ethical mortgage provider for you as well as the questions you should be asking your current or prospective provider.
Mortgage Search
Mortgage Provider
M&S Money
Green/Ethical Products
- M&S Ethical Fund
Ethical Lending or Insurance
M&S Money is a wholly-owned subsidiary of HSBC Bank. M&S Money operates retail banking only so ethical lending policies are not relevant in this instance.
Responsible Lending
1. Credit Lending
M&S Money offers unsecured credit (personal loans, credit cards) only.
In assessing applications for unsecured credit, the bank says that credit scoring ‘may’ be applied. This uses information supplied by the applicant as well as that obtained from credit reference agencies.
No information was found as to whether the bank has a policy to avoid or prevent offering unrequested increases in credit limits to customers.
2. Debt Warning
The bank issues pre-contractual warnings to customers stating that if they default on payments their credit rating may be affected.
It also refer customers to the FSA’s Debt Test which is designed to help customers find out whether they have, or are likely to have, problems with borrowing. It also has tips on what to do if customers find themselves in difficulty.
3. Debt Management and Advice
The bank offers only generic advice to customers in financial difficulty and refers them to external debt advice agencies such as the Consumer Credit Counselling Service (CCCS), PayPlan, the National Debtline and the Citizens Advice Bureau.
The bank states that customers are invited to call should they find themselves in financial difficulty and it states that it deals with such customers on a case-by-case basis. No details of possible repayment restructuring or payment holidays for customers in financial difficulty were found. However, M&S Money offers a three month initial deferral period on personal loan repayment.
Financial Exclusion
M&S Money does not offer any products or services to the financially excluded nor does it or its parent company engage in partnerships with credit unions or other mutual organisations.
As it is a retail banking business only it does not offer microfinance or preferential lending to communities.
M&S Money makes some provisions for disabled customers by providing information on products in Braille, large print or audio cassette formats.
Environment
M&S Money is part of Marks & Spencer Financial Services, a wholly owned subsidiary of HSBC Bank plc.
HSBC’s environment policy covers the key areas of climate change/energy efficiency and waste management. The policy also contains a commitment to continued improvement in performance.
Carbon Neutral
The parent company’s business operations have been carbon neutral since 2005.
Equal Opportunities
The bank addresses the key issues of gender, race, disability and sexuality in its equal opportunities policy.
Women on the Board
The parent company, HSBC, reported 10.5% women on its board in 2007.
Voluntary Standards & Initiatives
Parent company, HSBC is a signatory/member of a number of charters and initiatives including:
Charitable Giving
HSBC donated 0.48% of its pre-tax profits to charity in 2007.
M&S Money
- Current Accounts
- Savings
- Investments
- Credit Cards
- Loans
- Mortgages
- Insurance (Home, Motor, Travel, Life, Pet, Wedding)
M&S Money
M&S Money
Customer Services Department
Kings Meadow
Chester
CH99 9FB
