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Woolwich Mortgage

In the world of modern finance, history is a deceptively important part of a business’s identity. Although the size of many corporate banks can make them appear monolithic to the outside observer, in reality these organisations have hundreds of years of history behind them, which defines the ethics and codes of conduct by which they practise their business. Even the largest of banks has deep roots in surprising places, and a deeper look into the history of the banks we know today can uncover a diverse and varied past. Barclays bank is one such organisation; though it may appear today that Barclays is one enormous corporation, the business is in fact a conglomeration of many different banks which have all been brought under the Barclays umbrella.

The Woolwich brand is one such bank; from their long and varied history as a building society to their eventual incorporation as a publicly traded company and merger with Barclays, the Woolwich has a corporate identity all of its own which gives it a relatable, discernible character. As the mortgage branch of Barclays, Woolwich are one of the most trusted and reliable sectors of the business; chosen in part for their identity as a well-respected building society, Woolwich mortgages offer high quality and competitive home loans for both first time buyers and home movers.

Whether you’re looking for a hand up on to the property ladder, or whether you want to make your way on to the next rung, Woolwich mortgages offer a variety of solutions which can make owning your own home a pleasant, straightforward experience. The Woolwich mortgages company philosophy is best shown with an understanding of where the business has come from, what their roots are, and how they’ve become one of the most trusted mortgage providers in the UK.

The Woolwich Building Society

Building societies are a fundamentally different form of organisation to mainstream banks. The key point to understand is that a bank is run privately, and raises funds by selling shares to investors. These investors are then entitled to a percentage of the bank’s profits each year, and receive dividends according to their holdings in the bank. Because the bank must maintain a steady stream of revenue to the shareholders in order to keep them happy, it’s forced to make profits a priority; they have to make enough money to keep the bank operating and growing whilst also paying the shareholders.

A building society works differently, and has a particularly rewarding business philosophy. Building societies raise the capital for loans directly from the deposits they receive, instead of by selling off shares in the business. This means that the business can only loan out as much money as it has received in deposits, potentially restricting the pool of funds it can access. However, building societies don’t need to pay dividends to shareholders either, and can therefore offer more competitive products as they don’t need to make as much of a profit. Building societies are also able to operate on much slimmer margins because they aren’t really designed to make huge profits for their owners, unlike mainstream banks – the goal of a building society is, as the name implies, to build.

Beginning in Birmingham in the late 18th century, building societies were brought about by the need to provide an investment option for the recently-enriched owners of small businesses in the area. The Industrial Revolution had made the owners of small metalworking shops and smithies very wealthy, as the demand for their services increased dramatically. This newfound wealth had to go somewhere, and in a room above a local pub the idea of a building society was born: rather than giving all their money to the local banks, which were still reluctant to accept deposits from the “new rich”, these businessmen could contribute to a local fund for the construction of new housing. The investors in this fund would make regular deposits, and the total funding pool would be used to construct new homes for members. The lenders would receive interest on their loan, but since there were no intermediaries to pay dividends to they could make a reasonable return on their investment whilst still offering a cheap interest rate. This arrangement became so popular that within fifty years nearly every town in the UK had at least one building society, and many major cities had dozens of competing societies.

The Woolwich Equitable Benefit Building and Investment Association was founded in 1847, and quickly expanded, with a total of 43 Woolwich Building Societies across the country by 1947. Over the next fifty years the Woolwich went from strength to strength, merging and incorporating with multiple major competitors until it was one of the largest building societies in the country. The Woolwich Building Society was well known for its tongue-in-cheek advertising campaigns featuring their slogan “I’m with the Woolwich!”, and provided sponsorship for sports teams and charitable efforts. Over the course of its evolution from a small single office building society in 1847 to its status as a major banking organisation at the end of the 20th century, it became apparent that the traditional model of a building society was becoming increasingly cumbersome; the inherent reliance on deposits as a source of income made it hard for building societies to compete with incorporated banks, and the industry was crying out for change.

In the 1980s, it came; the UK Government passed regulations which allowed building societies to “demutualise”, and convert into banks by floating on the stock exchange. A wave of demutualisation followed, with the UK building society sector falling from hundreds of organisations to just a few dozen. Demutualisation was a democratic process; since every account holder could vote on whether to demutualise or not, the only building societies which followed this process were the ones whose members voted to do so. The Woolwich Building Society was one such organisation, and in 1997 the society was floated on the London Stock Exchange, with borrowers and lenders becoming shareholders in the new bank.

Woolwich as part of Barclays Bank

After demutualisation, the Woolwich continued to trade as a bank, offering their competitive mortgage products and consumer credit to the market for several years. In 2000, though, the Woolwich was bought out by Barclays in a £5.4 billion acquisition, retaining the Woolwich brand name due to its long history and recognition amongst the public. Six years later, Barclays announced that Woolwich would become their specialist mortgage brand, and instead of offering a mix of products, Woolwich would now concentrate solely on providing top quality home loans to the market. Barclays would incorporate the rest of the bank’s operations into their own, thereby playing to each organisation’s strengths.

As of the modern day, Woolwich constitutes one of the most important parts of the Barclays bank’s operations. Unlike many other banks, they operate with the backing and financing of a major banking conglomerate behind them, yet still retain their individual identity and long history as a building society; the Woolwich mortgage brand continually offers products which lead the market in terms of the value they offer customers.

Woolwich Mortgages – What’s on Offer?

It can seem like the mortgage market is a little crowded these days, what with the plethora of lenders in the sector. Each lender typically has several dozen different products, all with slight variations that make them distinct and offer a different combination of rewards to suit different buyers. It’s difficult, though, to pick out which products suit which buyers, especially when price comparison sites can present all the different options together on one page – is a 2 year fix better than a 5 year tracker? Should you pay the fees upfront or defer them? Is it worth chasing a slightly lower interest rate from a smaller bank, or might they fall prey to rate increases more readily than a large bank?

These questions will be running through the mind of anyone searching for a mortgage, which is why the Woolwich and Barclays mortgages section is laid out in a clear format that is easily understood. Let’s look at the products which Woolwich offers to different types of buyer, and how they reflect the different needs of borrowers in different circumstances.

First-time Buyers

The main consideration for most first time buyers is saving up as much as possible for their deposit. The more money they can invest in the property at the time of purchase the better access they’ll have to more attractive mortgage products, and the larger a deposit is the better deals a lender is typically willing to offer. However, with no existing property to sell a first time buyer is usually forced to use their savings and pay in cash, which determines the situation of most first-time buyers: they can only afford a relatively small deposit of 5-10%, and they’re also likely to have little money left over once they move in. First-time buyers are therefore looking to secure a stable, secure payment plan once they’ve moved in, and the Woolwich First Time Buyers mortgage selection reflects this fact.

With a variety of fixed-rate and tracker mortgages on offer, the Woolwich mortgage range caters to many different preferences. Of course, a fixed rate mortgage allows borrowers to plan their spending in advance, safe in the knowledge that their bills will stay the same from year to year, but this predictability comes at a cost, since rates are typically fixed at a relatively high level. Buyers can also take advantage of a tracker mortgage, which will directly follow the Bank of England’s base rate – this means that the mortgage provider cannot raise or lower their rates in excess of what the base rate is, allowing the homeowner to benefit if interest rates should fall.

Other Options for First Time Buyers

Woolwich mortgages are flexible and committed to helping first time buyers with their first steps into property ownership. As part of the Government’s Help to Buy schemes, Woolwich have been offering a variety of mortgage products which are designed to lower the barriers to entry for home ownership, including various options for boosting the size of a buyer’s deposit. The Help to Buy equity loan, for example, allows borrowers to borrow a portion of their deposit from the Government instead of the bank, meaning that they can create a large deposit with only small savings. The Help to Buy mortgage guarantee scheme similarly works to help buyers with a small deposit, as it lets Woolwich and Barclays purchase “insurance” from the Government against defaulting borrowers; this lowers the bank’s exposure to risk and consequently makes the mortgage more affordable.

These Help to Buy initiatives are nationwide, and though not every bank in the UK is offering buyers access to these products they have become relatively commonplace. Woolwich and Barclays, however, have begun offering their own range of finance options to help accommodate the needs of first time buyers. Their “Family Springboard” scheme, for example, allows a buyer’s parents to fund the purchase of their property with a 10% deposit, and the buyer needn’t contribute any money to the deposit at all. This helps out first time buyers who are struggling to raise the necessary cash for a deposit of their own as well as the substantial costs of owning a property. Woolwich also offers cashback options to buyers as an easy way to take the strain off when making a purchase; the hefty legal costs and charges associated with moving mean that every penny helps, and a little extra cash from your mortgage provider can be a great bonus.

Moving House with the Woolwich

The Woolwich offers a wide range of products to suit every type of buyer, and those who are moving from a home they’ve lived in for several years could find that these products are perfectly suited to helping them up the property ladder. With the sale of their existing home, many movers will have significantly larger deposits than first time buyers do, and this enables them to access some of the best and most competitive mortgage rates on the market. For example, buyers who are able to invest 25% or more of a property’s value in the deposit can take advantage of substantially lower interest rates, and can also choose longer periods of fixed or tracker rates on their loans.

Remortgaging with the Woolwich

As previously mentioned, today’s mortgage market is increasingly crowded, and this has driven competition for customers to new heights. One of the most important innovations driving this competition is the ability for homeowners to easily switch mortgage providers; currently, it takes between four and eight weeks to transfer an existing mortgage to a new provider, but the UK Government has begun encouraging mortgage providers to enable customers to switch much more quickly in the future.

Woolwich mortgages are tailored towards customers who want a pain-free and simple switching process; their remortgaging service includes free valuation and standard legal fees, and some customers may also be eligible for cashback rewards as well. This makes switching to the Woolwich an attractive option for many homeowners, and can open up new opportunities for those looking for a better deal.

Buy to Let with Woolwich Mortgages

The UK property market is one of the most buoyant in the world, and the attractive nature of real estate investment has drawn considerable interest from landlords. Although new regulations have made buy-to-let a less profitable investment than before, the rewards on offer are still enough to continue driving growth. Woolwich’s buy to let mortgages cater to new and experienced landlords alike, and offer the same high quality of service whilst reflecting the nature of the loan as a business investment rather than a residential one.

Buy to let mortgages are usually more restrictive in the terms they offer than residential ones, and often require a high level of deposit from the buyer. In addition to this, there are several other criteria which prospective borrowers must fulfil; they must be able to prove that they have a stable income in addition to their rental income, and must also be able to demonstrate that the property will generate enough income to cover the cost of the mortgage. The range of products which Woolwich offers to buy-to-let investors is diverse, and caters to many different types of buyer; similar terms of fixed rate and tracker periods are available with these types of mortgages, just as with Woolwich’s other financial products.

Woolwich Mortgages as Part of Barclays

As a specialist branch of one of the UK’s largest banks, Woolwich are in the position of being both a well-respected institution in their own right, whilst also having access to the valuable backing of a national banking corporation. This potent combination allows the Woolwich to offer highly competitive loans at a market-leading rate, whilst also demonstrating to customers that they are not simply a generic and uncaring brand; the Woolwich has its own corporate identity which has been developed over the 170 years since its founding.


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Registered office: 1 Mayfair Place, London, W1J 8AJ. Registered in England Number 8147460.