News Article Published:
Thursday, 16 August 2007
Category:
Financial Services
One of the Nationwide Building Society's TV adverts caused a viewer to complain to the Advertising Standards Agency (ASA), after he claimed it was misleading.
An advert for Nationwide's mortgage with no higher lending charge (HRC) was criticised, although the viewer's complaint was not upheld by ASA.
The problem revolved around the advert that featured a couple organising their mortgage with a financial advisor. The disgruntled pair left the bank after finding that a £2,000 HLC was being charged as they only had a small deposit. The advert shows them walking into a Nationwide branch, which has a notice saying "Mortgages with no Higher Lending Charge" in its window.
A voice-over on the advert says: "At Nationwide we don't make you pay a higher lending charge however small your deposit".
The viewer said the advert was misleading because people with deposits of less than ten per cent were charged a higher interest rate. He said that this was effectively an HLC by other means, which the advert does not point out.
However, Nationwide argued that an HLC was defined by the Financial Services Authority as "a fee charged by the mortgage lender where the amount borrowed exceeds a given percentage of the value of the property".
ASA agreed that an HLC is a specific additional fee, which it was true that Nationwide do not charge, so the advert did not mislead in any way. Whatever rate of interst Nationwide charges, the message the advert conveyed was that it does not charge an HLC.
The Broadcasting Advertising Clearance Centre (BACC) concurred with ASA's judgment.
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