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Archive for July, 2007

Top Savings Accounts

Thursday, July 26th, 2007

After the latest Bank of England rate rise, many banks seem to be having a savings rate war with some internet savings accounts paying up to 6.3% or 0.55% above the new bank rate.  Some banks that have passed on the 0.25% interest rate rise include ICICI Bank UK, Sainsbury’s Bank and Icesave, offering rates as high as 6.3%.  Sainsbury’s internet bank has raised its rate to 6.25% from 6% and is free from any conditions and pays all savers the same rate.  However savers will have to wait nearly a month for the rate rise to come into effect on August 1.  The UK savings account that is offered by Icelandic bank Landsbanki, has raised its rate to 6.2% from 5.95%, however demands a minimum balance of £250.  Landsbanki also has a guarantee to be at least 0.25% above the bank rate until October 2009 and will apply the current rate hike on July 13.

With more banks offering competitive interest rates on savings accounts, the news of more interest rate increases in the future may not be such bad news, especially for those who have taken advantage of these accounts that are offering the highest rate of interest on savings accounts.  If you are searching for a savings account that will offer you the highest rate, you may try your luck at searching online for internet savings accounts as they are currently offering the highest rates of interest.  For many borrowers, overextended with mortgages and secured loans, the news of recent interest rate hikes have come as dreaded news, however for those with savings, the interest rate increases will come as good news.

Posted in Banking, Borrowing, Consumer Credit, Debt management, Financial products, Homeowners, interest rates, mortgages, Personal loans, Savings, Secured loans, UK Finance | No Comments »

Borrowers Faking Pay Slips

Wednesday, July 25th, 2007

Many UK borrowers are putting their financial future, and possibly risking jail time, by creating fake payslips.  This will let them borrow bigger mortgages and loans, reduce their interest payments, and lower fees.

The Institute of Payroll Professionals (IPP), is seeing an increasing number of websites which now offer ‘duplicate’ payslips, without taking time to check whether the customers information is valid.

These websites cannot legally verify the details provided by consumers looking to buy fake pay slips as the only official parties who would prove salary information – the payroll departments of their employer and the HMRC – are bound by the Data Protection Act,” the IPP website confirms.

This will increase debt and insolvencies as more homeowners are struggling to make payments they cannot afford. Analysts are worried that, if this becomes a wide spread practice, that it will create a false image of the economy as more and more people apply for bankruptcy and IVAs.

Richard Fiddis, Managing Director, at the global information solutions company Experian, said:

“Insolvencies rose by two-thirds in the second quarter of this year, while IVAs, which make up almost half the total, soared by over 150 per cent.”

“One of the most striking differences between those opting for bankruptcy and those for an IVA is illustrated by socio-economic analysis,” continues Fiddis. “Experian’s Mosaic consumer segmentation system shows that people in the ‘Happy Families’ group, comprising largely young families, are more than 60% more likely to be tempted by an IVA.”

These numbers will increase as people continue to ‘fake’ mortgage and personal loan applications.

Posted in Bankruptcy, Borrowing, Consumer Credit, Consumer debt, Financial news, Fraud, Homeowner Loans, Homeowners, House buying, Housing news, Insolvency, interest rates, mortgages, Personal debt, Personal loans, Property, Secured loans, UK Finance | No Comments »

Tracker Mortgages

Wednesday, July 25th, 2007

With five interest rate increases in less than a year, many borrowers are now turning to other mortgage options besides the commonly chosen fixed-rate mortgage.  For years the fixed-rate mortgage has been the popular choice amongst borrowers, as it offered the security of knowing what your monthly repayments would be.  However, with the base rate increases from the Bank of England borrowers are discovering that it is near to impossible to find a fixed-rate mortgage that is offering a good deal.  The prices of fixed rates have gone up since May as the money markets have factored in two further interest rate rises in the past three months, causing lenders to increase their rates.  Because of the lack of decent fixed-rate deals, borrowers are starting to search the market for other borrowing options, such as a tracker mortgage.

With the base rate set to rise yet again, tracker mortgages may be the best option for borrowers.  Figures show that there has been a subsequent drop in the number of borrowers who were taking out fixed-rate loans in June.  Around sixty-one percent of borrowers opted for a fixed-rate mortgage in June, which is down from seventy-three percent in May.  Experts predict that although there have been two further increase over the past three months, a tracker mortgage may be a cheaper option over the next two years.  There are banks and building societies that offer 0.32% below the base rate with a £999 fee until September 2009.  With the current base rate, a borrower will pay £19,666 on a £130,000 home loan.

Posted in Borrowing, Consumer Credit, Financial news, Financial products, Homeowner Loans, Homeowners, House buying, Housing news, interest rates, mortgages, Property, Secured loans, UK Finance | No Comments »

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