Apply Now For Your FREE Loan Quote!
Thu 28th Jun, 2007
Posted in Bad Credit, Consumer Credit, Personal loans, Homeowner Loans, UK Finance, Credit Card, mortgages, Consumer debt, Spending, Property, Unsecured loans, Financial news, Borrowing, Personal debt, Secured loans, Debt management at 12:21 pm by admin
Recent reports state that the UK still holds the largest personal debt of all western Europe. The current total stands at £1.3 trillion in mortgages, credit card borrowing and personal loans. Britain is believed to be the most debt-ridden nation in Western Europe.
Statistics from Credit Action estimate the UK debt level continues to increase at £1 million every four minutes. This is in line with increased credit spending and mortgage borrowing. However, when these numbers were hit earlier this year, many analysts expected it to be a short-lived trend.
A conference organised by Citizens Advice Scotland (CAS) and the Debt on Our Doorstep campaign worked to examine the causes of the debt.
“Britons carry the largest debt burden in Europe, and people on lower incomes pay a higher price for that than those in wealthier households,” CAS chairman Graham Blount told the Evening Times.
“The conference will look at why we owe more, and what we can do to bring affordable and responsible credit to Britain.”
Recent reports stated that some of the main reasons for debt are increasing house prices, higher levels of mortgages in relation to annual income, and rising utility prices. Recent figures for credit card spending show that figures have been falling since last year, whilst loan take ups remain fairly static.
One of the biggest problems is also the availability of credit. Many young consumers have a skewed idea of debt, with many teens believing that they do not need to repay the money they spend off the credit cards the Banks hand out as schools.
This has prompted the government to instigate a program for financial education.
Permalink
Posted in Consumer Credit, Personal loans, Homeowner Loans, UK Finance, Credit Card, mortgages, Homeowners, House buying, Stamp duty, First time buyers, Spending, Property, Financial news, Housing news, Borrowing, Secured loans at 11:58 am by admin
A new study shows that the average cost of moving home throughout a person’s lifetime averages around £23,800. The study reveals that homebuyers often underestimate hidden costs such as solicitors’ fees, stamp duty, removal costs and estate agent fees.
Experts advise homebuyers that as the price of houses continue to increase that it is important for people to look at the bigger picture in terms of costs and budget for these additional fees that most home buyers rarely consider when purchasing a home.
The majority of homebuyers in Britain are not prepared for these hidden costs and do not have a contingency fund in place to cover these unexpected fees. It is estimated that only half of Britons have a contingency fund in place when they purchase a home to cover the hidden costs involved with the purchase. Buyers are frequently relying on personal loans to when it comes to down payments and other moving expenses.
Fifteen percent of home movers resort to additional loans and credit cards to cover the costs of moving and five percent rely on relatives for extra help. Around fifty-seven percent of homebuyers are not prepared to make the sacrifices needed to afford the property they want. However for those who do make the sacrifices it is found that one person in four skips holidays abroad and one in five give up eating out and buying new clothes. There are those who make larges sacrifices such as a change in career or they put off starting a family in able to afford the home of their dreams.
With the price of homes increasing it is important for buyers and sellers to do their research beforehand and make themselves aware of these fees and to be more informed about the option available to them to help with their finances.
Permalink
Wed 27th Jun, 2007
Posted in Consumer Credit, Personal loans, Banking, UK Finance, Financial products, Financial news, Borrowing at 1:07 pm by admin
Several Britons remain with bad bank accounts because they feel that the hassle of moving all their direct debits and standing orders is not worth moving to a better account.
A study done by Abbey found that sixty-five percent of Britons think that switching bank accounts would be difficult because of direct debits and standing orders. However, switching bank accounts has become easier for customers as banks are required to give details of all standing orders and direct debits to a new current account provider under the Banking Code. This simply means that customers only have to scour the bank market to find the best current account offers and have the account switched over, as the new bank will do all the work for you.
Many people continue to perceive account switching as a complicated task that is ridden with potential pitfalls. However, it is extremely easy to switch accounts as direct debits and standing orders can automatically be transferred from one bank to another.
Switching accounts due to the hassle of direct debits and standing orders was not the only concern from customers about switching, others felt that there was no point in changing as all banks are similar, or they felt that their bank would not help them switch.
Many customers who have taken out personal loans with their bank wrongly believed that this tied them to their existing bank. However, loans and other finance agreements can be held with banks where the consumer does not hold an account.
Some customers questioned felt that they would lose their personal banking contacts or lose their monthly benefits. These fears are unfounded, and it has been claimed that ninety percent of those who moved banks stated that it was a fairly easy to switch. Banks frequently offer better initial benefits to new customers to entice new business.
Permalink
Tue 26th Jun, 2007
Posted in Consumer Credit, UK Finance, interest rates, mortgages, Consumer debt, Homeowners, House buying, Financial products, Property, Financial news, Housing news, Borrowing, Secured loans at 2:15 pm by admin
According to research released by Credit Suisse, £200bn in mortgages (one fifth of the total British market) representing 1m homeowners will see their mortgage terms end this year.
They will be forced to renew their home loans when the interest rates are at a decade high rate, and possibly, an all-time high.
That shock to consumer spending will come even if the base rate does not hit the predicted 6.0% mark in September.
The rate hike, which is almost guaranteed to hit 6% by September, will catch some consumers refinancing their mortgages from .04% to .08% more than previously, depending on their credit rating.
The interest rate could be even higher as banks move to withdraw their affordable fixed rate options from the loans market.
Permalink
Posted in Bad Credit, Consumer Credit, Personal loans, Banking, UK Finance, Consumer debt, Financial news, Borrowing, Personal debt, Bank charges, Debt management, Overdrafts at 12:21 pm by admin
The controversy regarding bank charges has been a big issue of late, with customers taking claims to court to gain refunds from their banks.
With unfair bank charges being imposed on millions of people across Britain, more and more customers are turning to the courts for refunds.
Customers are being charged up to £40 for unauthorised overdrafts, bounced cheques, or failed direct debits and banks are being accused of ripping off customer with high charges.
If you feel that your bank has hit you with unfair charges there are some steps that you can then take to reclaim the bank charges.
The first thing to do is to know your rights. When you first open a bank account, sign on for a new credit card or enter into a contract, you will want to familiarise yourself with the terms of the contract.
Often bank charges for being overdrawn or for bounced cheques are the equivalent of a charge for breach of contract and can be enforced by the courts. However, the amount charged to you by the bank can only be the amount of the actual costs that was incurred by the bank, if the charge is more than the cost the bank suffered the charge then becomes a penalty, which can then be unenforceable by the courts.
Once you know your rights you will want to keep an eye on any excessive charges that your bank may charge. Some examples of excessive charges include a £20 charge for letters sent out informing customers they have breached an overdraft limit or £30 for a bounced cheque or failed direct debit.
You will then want to go through your old statements and add up all the charges that could be considered excessive and write to the bank requesting a refund for the charges. Often the banks may surprise you by obliging, however often they may dispute the charges with justified charges.
Some customers report being advised by their banks that the only way of clearing their high penalties is by taking out a high interest unsecured loan. This advice has typically been in the bank’s favour, and not the customer’s, with the new debt taking years to clear.
If you feel that you have been advised badly or you are not sure of your rights then it would be wise to visit an organisation such as the Citizens Advice Bureau. They will have access to data on your rights when borrowing money and on reclaiming unfair charges.
If the bank will not fulfil your request to return unfair penalties then you can take your case to the courts and attempt to obtain a refund of the excessive bank charges.
Permalink
Mon 25th Jun, 2007
Posted in Bad Credit, Consumer Credit, Personal loans, UK Finance, Consumer debt, Financial news, Borrowing, Insolvency, Personal debt, Bankruptcy, Debt management, Missed payments at 2:23 pm by admin
Consumers are warned to avoid bad credit loans at all cost. Many of these loans carry fees and interest rates that are so high they can force a consumer further in debt. There is also little proof that they are good tools to repairing a poor credit rating.
Economists warn that these loans are often created by companies who actually expect the borrower to miss payments and therefore allow them to apply extra penalties on top of the high interest already charged. This can lead an existing bad debtor to spiral into a worse credit situation than before.
Missing a loan payment from one of these loans will not only incur high fees from the lender, but it will also damage the borrower’s credit rating.
Consumers rarely measure the impact of a missed loan payment.
Sandra Quinn, of Apacs, states that that missing a single credit card payment is not likely to damage a credit rating, or even be recorded in their credit information report. However, debt management charities warn consumers that the risk of damage is too great.
A poor credit rating reduces the consumer’s opportunity of securing affordable financial products. The consumer will be forced to pay higher interest rates, higher fees, and even higher broker commissions.
Ms Quinn of Apacs stated that missing a payment may not leave a black mark on consumer’s credit report in her response to research from moneysupermarket.com. The website claimed that missed payments can leave the consumer with bank fines of up to £278, the result of losing the zero interest rate, and damage to their consumer’s credit rating, but Ms Quinn disagreed.
“A late payment on its own won’t necessarily damage your credit rating,” she said.
However, Rob Kenley, of moneysupermarket.com, said: “Failing to make a repayment could also have a negative effect on their credit profile.”
What is clear from research though is that consumers who genuinely wish to repair their credit rating and who are prepared to make all their repayments on time will reap the benefits.
“Aside from IVA and bankruptcy, Lenders are most interested in your most recent credit history,” says Abbi Rouse of online loan brokers, Interfinancial Limited. “By showing that you are now a responsible borrower who makes all their payments on time you can repair your credit history.
“If your credit history is currently poor then a bad credit loan is all you will be eligible for now. However, if you want to get a good rating and be eligible for better rates in the future then this is a good way to do it.”
Permalink
Posted in Consumer Credit, UK Finance, Savings, Inflation, Homeowners, Spending, Borrowing, Budgeting at 1:59 pm by admin
Food is considered to be one of the main driving forces behind the recent rise in the overall inflation that is currently running at 2.5%.
The prices of vegetables have risen along with potatoes by 16.5% over the past year with fresh fish rising by 12.8%, milk by 10.4% and eggs by 14.4%. At this rate people will need to start finding ways to reduce their food bills, especially with the rise in interest rates, which have been affecting households that pay mortgages.
“There has become an expectation amongst British consumers that food should be cheap,” says Abbi Rouse of online loan brokers, Interfinancial Limited. “But this view is being challenged by the current price rises.”
“Many households are now finding themselves borrowing money just to pay normal expenses, so a rethink is needed by many families.”
Some ways to reduce your food bill is by thinking ahead. By planning your meals in advance you will avoid buying unwanted food. If you plan a menu, you can then decide on what items you will need to purchase for the week and create a shopping list.
You should then use this list and stick to buying only what you need. You could also buy in bulk, which can be a cheaper option, especially if you have a large household.
If you life in a flat with one or two flatmates, you could all pitch in together and buy certain items in bulk that you feel you all could use such as rice, pasta, washing powder and cleaning products. However only purchase products that you know you will not throw away or waste.
Often purchasing your fruit and vegetables from roadside markets can be less expensive than buying in the supermarket. Usually at roadside markets you can bargain with the seller, whereas at a supermarket you have to pay the fixed price for the items. You could also save by looking out for special offers as well as reduced items that you could use that day.
“One way the nation wastes their money is in buying out-of-date food that doesn’t get used,” says Rouse. “Those ‘bargain bin’ items need eating the same day and if they are not frozen or used instantly they go in your bin, instead of the supermarket’s.”
“Consumers often assume that buying cheap foods saves them money, but a decent item can often stretch further. An 80p loaf from a proper baker will make great sandwiches, then decent toast, then breadcrumbs or pudding as it goes stale. A 20p plastic loaf goes mouldy after a few days and ends up in the bin.”
There are many ways in which you can cut down the expense of your consumption of food and plenty of fun cook books to help show you how. If you don’t want to buy them, why not get one on loan from your local library?
Permalink
Fri 22nd Jun, 2007
Posted in Bad Credit, Consumer Credit, Personal loans, UK Finance, Credit Card, interest rates, mortgages, Consumer debt, Homeowners, Spending, Property, Unsecured loans, Financial news, Borrowing, Car finance, Car loans, Personal debt, Store cards, Secured loans, Tenant loans at 2:23 pm by admin
The retail industry has taken major hits according to recent reports. The increases in interest rates has many consumers cutting up their credit cards and using cash instead of high interest rate store cards.
Almost 25 per cent of consumers use shopping to relive stress, according to new research from Retail Trust, with the younger generation - 18 to 24-year-olds - favouring retail therapy as a viable solution to stress.
The report states that men are more likely to carry debt than women. Almost 33% of men owe as much as 20% of their current income in debts such as secured loans and hire purchase car agreements. Older men, over 40 carry the most debt including mortgages.
Considering retail and service industry workers as a demographic group revealed a startling trend. Employees in the retail and service sectors have the highest debts, with eight per cent owing more than 71 per cent their annual income. Most of this is in the form of tenant loans and other unsecured borrowing.
Nigel Rothband, chief executive at Retail Trust, highlights these workers as most in need of financial advice and guidance.
“It is estimated that an astonishing one in five people in Britain work in the retail industry and the survey results reinforce the fact that there are a large number of people in need of help and advice,” he told Retail Bulletin.
The government is instigating initiatives to regain control over debt and educate the publish. However, understanding debt is the first step to creating a viable a solution.
Credit Action reports that personal debt was £1,318 billion at the end of March, 2007, with the annual growth rate recording an increase of 10.5 per cent.
Permalink
Posted in Bad Credit, Consumer Credit, Personal loans, UK Finance, Homeowners, Property, Borrowing, Tenant loans at 1:32 pm by admin
A new proposal that is being introduced will allow cohabiting partners to have similar rights to married couples.
For many years co-habiting Britons have wrongly assumed that the term ‘common law’ in regards to relationships is a legally binding term. The proposed change will give new rights to co-habiting couples who split up, in the manner of a divorcing couple.
“This makes good sense,” says Abbi Rouse of online loan brokers, Interfinancial Limited. “When you split with a partner you will still be liable for shared debts, such as personal loans, so the law should extend further regarding shared property.
“After all, when you co-habit with someone, their good or bad credit rating will reflect upon you, even after you’ve split up and this could affect your future ability to take out loans and other credit.”
The proposal will allow couples to make claims through the courts for maintenance payment, lump sums, each other’s pensions and a share of homes. It will also allow a woman who gave up her career to bring up children to be able to claim a share of her partner’s earnings.
The Law Commission state that this proposal will ensure that vulnerable and deserving women will be property rewarded. However there are many critics who claim that the government is eroding the state of marriage.
Currently the four million cohabiting couples that live in the UK have no financial rights if they split up. The proposal that is being introduced will also apply to gay couples and will allow the courts to divide assets based on an assessment of the economic contribution of each individual.
The new system is based on a ‘clean-break’ method which could see a mother getting a house and cash payouts but no long-term financial support.
It has been reported that most ministers are in favour of the reforms, however there is no timetable of when they will come into effect. There is pressure from campaigners for a time frame with the spokesman from the Ministry of Justice stating that the final recommendations from the Law Commission will be published in the next couple of weeks after which the decision will be left up to the government.
Permalink
Thu 21st Jun, 2007
Posted in Consumer Credit, Homeowner Loans, UK Finance, interest rates, mortgages, Consumer debt, Homeowners, House buying, First time buyers, Property, Financial news, Housing news, Borrowing, Secured loans at 12:15 pm by admin
Despite predictions that the housing market is cooling, some analysts expect it to increase, as much as 8 per cent in 2007 as the property boom continues. The surge in house prices continues to push home loan lending to record levels as home owners borrow to the hilt, as much as six times their income for a span of 40 years.
Desperation among first time homeowners is expected to continue feeding the boom, despite the increases in interest rate rises that have seen the cost of borrowing increase from 4.5 to 5.5 per cent in less than 10 months.
Graham Beale, Nationwide’s chief executive, said: “We expect the housing market to remain fairly strong this year.”
Interest rate rises have not slowed the market as quickly as economists expected.
“Strong demand from buy-to-let investors has supported housing demand and the under-supply of housing, especially in the South-east of England, will continue to be a supportive factor,” says Beale.
“Our forecast for house price growth is five to eight per cent in 2007, reflecting a cooling in the second half of the year in response to increases in interest rates.”
Home owners have braced for more interest rates to increase to 5.75 per cent, which experts think could come as early as next month. Some economists are going out on a limb and predicting that interest rates will hit 7% before the end of the year.
This has not slowed the scramble to buy a home before house prices fly out of reach for most young adults. Many prospective homeowners are preparing to pay lifetime mortgages in exchange for the privilege of owning a home.
Secured loans continue to be popular with people seeking to improve their property. Home owners are rushing to improve their homes and get them on the market before the housing boom ends.
Permalink
« Previous entries ·
