Halifax offers three market-leading ISAs

15 March 2012

Halifax has three market-leading fixed-rate ISA accounts available for three, four and five-year periods paying 4.25%, 4.35% and 4.5% respectively.

The accounts pay impressive rates and are a good option for savers who haven't yet opened a cash ISA for the current tax year (2011/12). 

Prize draws

Alongside the good interest rates offered, an extra benefit of opening one of these ISAs with Halifax is its premium-bond-style prize draw. Anyone with more than £5,000 in an existing savings account can enter the competition to win a share of the monthly prize.

The monthly cash prize pot is made up of three payouts of £100,000, 100 £1,000 prizes and 1,000 £100 prizes. But for the months of May and June the number of top prizes available increases so you have the chance of winning 10 £100,000 prizes.

To register for the competition you need to fill out a form on the website (halifax.co.uk/savings/savers-prize-draw) and have an existing savings account with Halifax or Bank of Scotland. To be eligible for the prize draw, you'll need to keep at least £5,000 in your account for the duration of the month the competition applies to.

As the accounts are on a fixed rate you won't be able to access your money during the term and early closure of the account will result in a penalty of 365 days' loss of interest.

Moneywise verdict:

These accounts offer competitive rates and with the extra incentive of a cash prize savers can earn interest on their money and potentially win a large payout. Although the prize draw is a gimmick, the market-leading rates on offer are appealing and as the accounts are ISAs any gains will be tax-free.

So are there any drawbacks? The main thing to look at is the type of account available. While you'll be able to earn a decent tax-free return on your savings these accounts aren't suitable for anyone who will need instant access to their cash.

If you are after instant access the AA's instant-access ISA paying 3.5% or the Cheshire Building Society's similar online account paying 3.35% would be more suitable.

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