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Fri 27th Apr, 2007
Posted in UK Finance, mortgages, Homeowners, House buying, Property, Financial news, Housing news, Rental property at 10:56 am by admin
Many adults are dismissing the idea of owning their own home - despite the growing number of affordable ownership schemes available in the UK. This is a disturbing trend, as potential homeowners are paying ridiculously high rents, far in excess of a mortgage, in some areas of the UK.
Research commissioned by the East Thames Housing Association states that 60 per cent of renters are unaware that schemes have been set up to help them buy a home.
A quarter of UK adults believed that shared ownership was only an option for key workers, whilst one in ten believe the schemes are only available to the unemployed or disabled.
Kate Worley of East Homes, part of the East Thames Group said: “Our survey showed that too few people understood what shared ownership meant.
“Either that or they don’t realise it’s available to a wider selection of people than they might think. If someone has a regular income but can’t afford to buy a home locally with the help of a mortgage, then New Build HomeBuy could be for them,” she added.
New Build HomeBuy refers to the scheme previously known as shared ownership.
The scheme allows tenants to buy part and rent part of a property. The tenant has the opportunity to buy more of the property as they are able to afford it. This can be an affordable alternative to may young families.
While many homeowners are afraid of sharing a home with friends or family, with just cause, the programs like New Build HomeBuy do not share the home with an individual, but with a corporation.
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Posted in Consumer Credit, Personal loans, UK Finance, Financial products, Unsecured loans, Borrowing, Secured loans, Debt management at 10:53 am by admin
If you are searching for a loan for whatever reason, whether it is for a new car, to consolidate your debts, or for improvement on your home, you will first start your search with banks and other lenders. However, most people do not realise that there are other alternatives to loans. For example, you could borrow from your employer, or use your savings instead.
Borrowing from your employer is a possibility if you work for a large firm, as most large firms have set policies for this. If you ask at the personnel department they will be able to give you more information on obtaining a loan from them. Employers will usually charge a lower rate of interest, however it does mean that you will be tied down to the job until the end of the loan term. If you leave the firm, you will probably have to pay back the loan there and then, which can be difficult if a large sum of the loan is left.
If you have a savings account, you may want to consider dipping into it instead of taking out a loan, so long as you don’t use all of your savings. By using your savings you will be saving yourself a lot of money in interest charges. When you take out a loan you can end up paying back double of what you borrowed.
Before you borrow, ask yourself if the loan is necessary. If it’s for a new car, ask yourself if the new car is necessary. Many people admit getting into debt for something they later wish they hadn’t bought. Borrowing money is expensive, so if you have loan alternatives available to you, you should consider using them if they are a cheaper alternative to a loan.
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Thu 26th Apr, 2007
Posted in Bad Credit, Consumer Credit, Personal loans, UK Finance, Consumer debt, IVAs, Financial news, Borrowing, Insolvency, Personal debt, Bankruptcy, Debt management at 9:28 am by admin
At one time debt management was limited to cutting up your cards, having your wages garnished, or receiving a slap on the wrist from the bank as they helped the borrower sort out his finances and repay the loan.
Then the UK adopted the IVA and ‘walk away from your debt’ attitude. The problem became so severe that the government had to prevent university graduates from petitioning for bankruptcy after school so they could ‘walk away from their debts.’
The Banks, and the government, are now battling the same problem with consumers who believe the myth that an IVA company will let them walk away from 50%, 80%, and even 95% of their debt – without consequences.
Debt is starting to cause serious social and economic problems in the UK, forcing the financial community into action. Debt is not only damaging people’s ability to build wealth and repay their current loans. It is damaging their health, relationships, and family life.
Debt Help companies like Credit Action have seen unmanageable increases in the number of cases they deal with. Debtmaters receive 11,000 calls a month.
The debt management sector are now taking a pro-active stance against debt.
Debtmatters’ financial solutions expert Michael Shirley states: “We find that even when people are able to admit they have a serious problem and contact us for help, they still may not have discussed their financial situation with their partners.”
It is becoming more difficult for adults to find financial institutions that will help them hide their loan information. The government has added their own debt help lines, and educational websites, but don’t expect a simple ‘tsk tsk’ as they help you get your debt under control enough to hide the problem.
The new method of debt management is to re-educate the borrower, make them more financially savvy, and work to both eliminate their debt and prevent future debt.
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Posted in Consumer Credit, UK Finance, Credit Card, interest rates, Financial products, Borrowing, Zero percent cards at 9:24 am by admin
Selecting a new credit card can often be confusing and overwhelming with the number of offers and deals that are currently available on the market. Borrowing money in any form is a serious matter and because it can be a bit confusing or intimidating, you may often end up choosing the wrong card and then later regret your decision after all the interest fees and charges have hit you. To avoid the mistake of choosing the wrong type of credit card, there are a few things that you should consider before applying for a new card.
Before you start your search for a credit card, you will first want to ask yourself why you will need a new credit card. Your reasons could be that you want a card with lower interest rates than your current cards, another reason could be that you want to transfer a balance on a card to one that offers a 0% introductory rate. Once you have determined the reason for your new card, you can then narrow down your search on the type of card you want. By searching on credit card comparison websites, you will be able to select the type of card you wish to find and the site will pull a list of several credit card companies that have offers on what you are looking for. For example, if you are searching for a 0% introductory interest rate the site will post a list of cards starting from the best offer.
When you are searching for a card, you will want to keep in mind the reason you are applying for a new card, as well as other benefits that you want to gain from the card. By keeping focused during your search, you will be able to find a card that is right for you and that you will not regret applying for.
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Wed 25th Apr, 2007
Posted in Consumer Credit, Personal loans, Banking, UK Finance, Consumer debt, Financial news, Borrowing, Bank charges, Debt management at 12:38 pm by admin
At last banks and building societies are being forced to admit that their charges are unfair.
For a while now headlines have been full of stories of people fleeced by their banks for going overdrawn by tiny amounts. Banks have made a killing in recent years by charging what they now agree to be excessive amounts for overdraft breaches. Many customers have found charge after charge piled onto their accounts before they even realised leaving them unable to clear the vast sums accruing.
The Alliance & Leicester are one building society who have now agreed to fix a reasonable charge for bouncing cheques. Following a recent BBC report claiming that charges should amount to no more than £4.50, the building society has agreed to refund the difference to their customers between their old rate of £25 per bounced cheque and the new sum.
But whilst some of the poorest and financially careless customers may be cheering that their charges will be refunded, experts are expecting a new wave of charges to take place of the old ones.
“People may be seeing a return of their charges for unauthorised overdrafts or bounced cheques, but this is not the end of the matter,” says Abbi Rouse of loan brokers, Interfinancial Limited.
“Banks have been used to gaining revenue from those customers unfortunate to go overdrawn or careless with their finances. Now all customers will be seeing extra charges on their accounts as banks try to claw back profits.”
Customers across the board can now expect to see higher charges for personal loans, insurance, banking and other financial services warns Rouse.
At the end of the day, the customer may be right, but the banks will always win.
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Posted in Consumer Credit, Personal loans, Debt Consolidation, UK Finance, interest rates, Consumer debt, Financial products, Unsecured loans, Borrowing, Personal debt, Secured loans, Debt management at 12:36 pm by admin
If you find that it has become harder for you to keep track of your monthly expenses, or begin to realise that your expenses are exceeding your income, you will want to take immediate action to fix your financial problems. One way of regaining control of your expenses and paying off your debt is through a consolidating loan. There are many benefits and ways that a consolidation loan can help you with your finances.
A consolidation loan works by taking out one loan that will then be used to pay off all your current expenses and turn it into one monthly payment. This can help relieve the stress of having to worry about when bills are due; instead you will only have to focus on one monthly repayment. By writing down all the current balances on your credit cards and debts and writing down the interest rates, you will be able to know just how much you will have to borrow and how low the rate will have to be on the loan in order for it to be beneficial and help you reduce the total amount of repayments towards debts.
The benefits of a consolidation loan include the fact that you will have the ease of only having to pay off one debt, instead of three, four or more. If you search around and do your homework you will also be able to benefit from an overall lower monthly expense, and with the extra savings you can place it either in a savings account or towards to consolidation loan to pay off your debt quicker.
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Tue 24th Apr, 2007
Posted in Consumer Credit, Personal loans, Homeowner Loans, UK Finance, interest rates, mortgages, Consumer debt, Homeowners, Financial products, Spending, Property, Financial news, Housing news, Borrowing, Home Improvements at 11:39 am by admin
Data analysis by Sainsbury’s Bank home insurance has put home cost inflation at 12% per year. Sainsbury’s experts reckon that householders now estimate that running a home in the UK costs around £11k; nearly £1200 higher than it was only three years ago. In persepective, this amounts to a rise in running costs of about £3.28 per day.
However, Sainsbury’s believe that homeowners can dramatically reduce their costs by shopping around for more competitive rates on home insurance, mortgages and gas and electricity supplies.
“It’s becoming more expensive to run a home,” says Robert O’May, home insurance manager at Sainsbury’s Bank. “[This] makes it all the more important for homeowners to shop around to make sure they are getting the very best deals available. This is not only for their mortgages and utility supplies but also their home insurance.
“We’ve produced a free guide available at www.sainsburysbank.co.uk/homeguide which looks at how homeowners may be able to reduce the cost of running their home.”
Mortgage repayments account for around 60% of the total annual cost of running a home, followed by the money spent on alterations and improvements, which accounts for over 12% with gas and electricity bills seeing the biggest percentage increases of almost 27% and 19% respectively.
With recent interest rate rises, and more likely to come, it makes sense for homeowners looking to make alterations or home improvements to shop around for cheap loan rates, which are still out there. Many homeowners go straight to their high street bank, which typically offer uncompetitive rates compared to those available on the internet.
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Posted in Bad Credit, Consumer Credit, Personal loans, UK Finance, Credit Card, interest rates, Consumer debt, Financial products, Spending, Credit record, Balance transfer, Unsecured loans, Borrowing, Secured loans, Debt management at 11:24 am by admin
Bad credit can be very damaging to your financial future, as it can prevent you from obtaining loans, or a loan with a lower interest rate. If you currently have poor credit and you would like to make changes to improve your credit score as well as your financial future, there are a number of things that you can do to improve your finances.
One of the things that you can do to help improve your finances is paying your bills on time. As obvious as a solution as this may seem, many people fail to do it and end up reaping the consequences. If you fail to pay your bill on time, not only are you slapped with late fees and other charges, but the late payment will also end up on your credit report. This can be damaging if you later want to borrow money, as lenders will see your late payments as a bad mark and possibly refuse you a loan based on the fact that you are late on your payments.
Paying down your debts is another way to help improve your finances. As hard as this may seem, it is possible. By not only paying your bills on time, but also paying them off completely, it will reflect on your credit report and improve your changes of obtaining a lower rate on a loan if ever you apply for one. Paying off your debts will not only look good on your credit report, but it will also help keep you from falling into debt. If a balance is carried over on a credit card, you will then have to start paying interest on the amount owed. It is best that you pay off the full amount before the interest rate is charged to avoid having to pay extra for your purchases.
If you already have more than two credit cards, there is no need to have new or existing credit cards. Your credit cards should be used for emergencies only, and by having less cards, the less likely you will be tempted to carry one when you go shopping and make unnecessary charges on the account.
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Thu 12th Apr, 2007
Posted in Bad Credit, Consumer Credit, Personal loans, Banking, UK Finance, Consumer debt, House buying, Financial products, First time buyers, Spending, PPI, Unsecured loans, Financial news, Borrowing, Personal debt, Secured loans, Bank charges, Debt management at 10:50 am by admin
While consumers are reeling under the pressure of high fees, and are considering turning away from the big banks, the FSA is continuing to investigate the financial industry.
However, consumers are misled concerning areas that the Financial Services Authority is investigating. Partly because they are combining the Office of Fair Trading’s actions and the FSA’s as one collective body, which is misleading.
The FSA is investigating whether PPI premiums are too high. Currently, PPI premiums can increase the cost of a loan by more than 50 per cent and offer little more than 20 per cent of the value of the loan. These issues are referred to the Competition Commission for examination.
The legitimate questions are about how PPI is sold and the real cost of banking and administrating a PPI policy. This creates a problem for the FSA and the Competition Commission.
The organisation needs to tread lightly. History has shown that a de facto cap on the bank’s earnings from PPI products will force them to recoup the lost income elsewhere.
Unfortunately, the poorest, uneducated, and relatively disadvantaged shoulder the burden – those who cannot afford a personal loan or a PPI to start with.
Consumer watchdog organisations are worried that the banks will take the same approach they did when the OFA capped overdraft fees last year. This will leave thousands of consumers unable to obtain debt management loans or afford a first home.
Fear that the banks will tighten their lending criteria until only the middle and upper income tax groups can obtain affordable loans is the main concern behind the debt charity’s mandate when lobbying government.
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Posted in Bad Credit, Consumer Credit, Personal loans, Debt Consolidation, UK Finance, Credit Card, interest rates, Consumer debt, Financial products, Spending, Credit record, Unsecured loans, Borrowing, Personal debt, Secured loans, Debt management at 10:47 am by admin
Credit cards make it so easy for you to make purchases that many people end up using their credit cards for everyday purchases. However, your credit card should only be used for emergencies. If you discover that you are starting to use your credit cards everyday and are becoming extremely dependent on them, to the point where you are living off your credit cards, then you need to regain control of your spending before you fall into debt.
If you find that your finances are heading for disaster because of your credit cards, the first step you need to take is to avoid purchasing things with your credit card that you know you can easily pay for with cash. Keep your credit cards at home and only use them for emergencies. If you go shopping, keep your card at home and make a list of what you need to buy and bring enough cash to cover your purchases. This way you will stick to what you need and avoid buying any unnecessary items.
If you can make additional payments on your credit cards, then do so. Credit card companies are all too happy allowing you to only make the minimum payments, as they reap from the interest rates you are paying. By paying more than the minimum amount on your credit cards, you will not only avoid having to pay so much money towards interest rates, but you will also bring down your debt faster. You will want to make additional payments to the card with the highest interest rate, as that card is the one doing the most damage on your finances. Slowly you will see the improvement in your debt.
If you are making all your purchases on your credit card and making only the minimum payment each month, you are seriously in debt. You should consider a consolidation loan which will pay off your credit card. This loan will typically have an interest rate of as little as 5.7% - compared to rates of 16% and more for a credit card. After this you need to make regular monthly payments to pay off the loan or risk ruining your credit rating. And then you need to avoid using your card until your finances are in order again.
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