Mortgage Overview

Standard Life bank does not give credit so has no lending policy.

However no ethical policy with regard to its insurance business was found.

1. Credit Lending 

Standard Life Bank offers an LTV (loan-to-value) rate of 75%. This compares very favourably with the suggestions of the FSA’s Turner Review that a maximum of 90% of a property’s price be loaned i.e. that borrowers should have at least a 10% deposit for a mortgage. 

The bank does not publish LTI (loan-to-income) rates, 3.5 times income for sole applicants is the figure put forth in the Review. The bank states that it uses an affordability assessment using borrowers’ net income, current level of contractual commitments and estimated household expenditure to arrive at a mortgage figure. However, what limits are imposed on borrowing as part of this type of assessment is not disclosed. 

The bank does not offer unsecured credit, such as personal loans or credit cards. 

2. Debt Warning

Standard Life Bank issues the generic warning: ‘Your home may be repossessed if you do not keep up repayments on your mortgage.’ It also states that the Key Facts Illustration (KFI) document given to applicants contains a number of additional warnings around the risk of rising interest and changes in personal circumstances. This document is not publicly available, however.

The bank does not refer customers to the FSA Debt Test or an equivalent. This test aims to help customers find out whether you 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 outlines the assistance it will offer customers experiencing difficulty repaying their mortgage as follows: 

• It will contact the customer to discuss the problem ‘at the earliest opportunity’
• Will talk to a free debt advice agency like the Citizens Advice Bureau on the customers behalf if requested
• May be able to arrange a new payment plan
• May be able to change the way payments are made
• The customer may be able to reduce monthly payments by repaying mortgage over a longer period
• May be able to change the type of mortgage  

It also clearly outlines the steps involved in the repossession process. 

The bank supplies customers facing repossession with contact details of re-housing organisations but no evidence was found that the bank engages with these organisations on the customers’ behalf. 

The bank offers up to two payment holidays per year once customers have made six consecutive payments. This offer is subject to sufficient funds in the customer’s Cash Reserve or Prepayment Reserve and customers much give 22 days advance notice of when they want to miss a payment. 

Standard Life does not offer any products to the financially excluded within the UK nor has it engaged in significant partnerships with credit unions of other mutual organisations.

In terms of access for customers, Standard Life provides information in Braille, large text and CD format. For customers for whom English is not their first language, staff members offer translation in up to 40 languages.

Standard Life is part of the Global Commercial Microfinance Consortium. It is also part of the Deutsche Bank Microfinance Consortium which lends money to microfinance initiatives who then lend the funds to individuals or collectives.

No pledge was found on making business operations carbon neutral.

No clear policy statement was found that addresses the key issues of gender, race, disability and sexuality.