Wed 31st Jan, 2007

Comparison of the most expensive car loans on the market.

Posted in Bad Credit, Borrowing, Car finance, Car loans, Car ownership, Consumer Credit, Consumer debt, Financial news, Financial products, Homeowner Loans, Personal debt, Personal loans, Secured loans, Spending, UK Finance, Unsecured loans, interest rates at 10:09 am by Steve Smith

If you have very poor credit, then it may be advisable for you to consider very carefully before you take any extra credit on board. However, if you do need credit, there are a number of lenders that are currently catering to this market. The loans reviewed here are not dependent on home ownership and are available to be used on cars.  Accept car credit for example, offer car loans that allow you to buy from any car dealer in the country. They have a loan on offer at 28.7 percent that is a fixed rate. Accept do not advise what the early redemption fee will be but do state that there is likely to be one. There are no other fees associated with the loan. This is the Gold loan.

If you have trouble qualifying for the Gold loan, then Accept also offer a Silver loan that comes in at a more expensive 36.2 percent. This loan offers similar terms to the Gold loan, apart from the higher interest rate that is charged.

An even more expensive option is Auto Credit Finance which offers an online car loan priced at a whopping 38.9 percent. It would not be very advisable to take out a loan at this price but it available with no arrangement fees and an early redemption charge that varies from applicant to applicant.

Finally, there is the Personal Loan Centre which offers an unsecured loan at 48.2 percent. This loan is available to all qualifying applicants with no requirement for security. The Loan is offered by the London Scottish Bank Group and research shows that actual APRs may be as high as 60.8 percent. At this rate you may be better off waiting till you can buy your car outright.

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Inflation Rate at 11 Year High

Posted in Banking, Borrowing, Consumer Credit, Financial news, Personal loans, UK Finance, interest rates at 10:08 am by Steve Smith

One week after being hit by a surprise interest rate increase, city analysts were predicting that the inflation rate for December will be close to 3 per cent, an 11 year high.  November 2006 was the seventh consecutive month it was above the 2 per cent target.

The Bank of England’s has set a target rate of 2 per cent. If the inflation rate does rise above 3 per cent, Governor Mervyn King will need to write a letter of explanation to the government, the first time since the Bank gained independence in 1997.

Mr King will also need to predict how long it will be before the inflation rate returns to the 2 per cent target and how the Bank of England expects to meet the Government’s monetary policy objectives.

The latest Consumer Prices Index (CPI) for December was known by the Bank of England and was the catalyst for the recent interest rate increase of .25 percent, to 5.25 per cent.

Malcolm Barr, of JP Morgan Chase Bank, and ING economist, James Knightley, expects the figure to reach 3 per cent,

Investec economist, Philip Shaw, who initially predicted a modest 2.8 per cent has since admitted there is an “upward risk”, which may see it rise as high as 3.1 per cent.

He said: “It is fairly easy to see it going up to 2.9% or 3%, but 3.1% is also possible, although you’d need a huge surge in food prices in particular to get that sort of jump.”

All of this is stressing news for the loan industry and the housing market, as it points to future interest rate increases, some predict as early as March.

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Tue 30th Jan, 2007

Leading Causes of Debt in UK Households

Posted in Bad Credit, Borrowing, Consumer Credit, Consumer debt, Credit Card, Financial news, Financial products, Personal debt, Personal loans, Spending, Store cards, UK Finance, Unsecured loans, interest rates at 10:01 am by Steve Smith

The Debt Counsellors Annual UK Debt Survey, has turned the focus from unsecured loans to store card debt and credit cards as the prominent factors causing debt problems in UK households.

The combined of transactions made on charge, credit, debit and store cards is expected to grow to £639 billion in 2010, according to Credit Action.  Currently, more than 41 per cent of UK adults who need help dealing with their debt problems owe money on store cards, while credit card debt is a major factor in 91 per cent of cases.

The unregulated interest rates on store cards have a devastating effect on household finances. Store card debt is relevant in January as consumers are hit with the results of Christmas shopping.  Research from Alliance & Leicester Personal Loans reveals that 23 per cent of people used store cards for Christmas spending.  The problem arises because they are not using the cards for convenience, but to spend money they do not currently have.

John Porter, senior counsellor with the Debt Counsellors, said:

“Store cards can be tempting because of free gift incentives or offers of discounts. It is fine to take advantage of these but the balance must be paid off immediately, otherwise excessive interest fees will be incurred.

“In fact, the best advice is to avoid store cards altogether, because store card debt can mount up very quickly due to the high interest rates and it is best to keep temptation at bay.”

Porter adds: “Anyone worried about their store card debt, or any other kind of personal debt problems, should get professional debt counselling. The Debt Counsellors provide free, confidential debt advice.”

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