Apply Now For Your FREE Loan Quote!
Wed 21st Nov, 2007
Posted in Bad Credit, Consumer Credit, Personal loans, Debt Consolidation, UK Finance, Credit Card, interest rates, Consumer debt, Student debt, Unsecured loans, Borrowing, Personal debt, Debt management, Budgeting at 1:52 pm by admin
One of the most expensive times of year for the parents of teens is August. Back to School means arguments about the difference between a good outfit, and an in-style outfit. The difference can be £500.
Adding books, tuitions, bus passes, sports, after school events and social outings can cost more than one month’s income. Few people have enough money to cover a student’s entire list of wants and needs. This problem is compounded when a family is trying to send two or three teenagers to school at the same time.
Many students earn their own money to help cover school costs. But parents need to be aware that others apply for credit cards as a form of unsecured loan without their parent’s knowledge.
Banks actively recruit students. Many students believe this is free money, a perk. They run up the limit, and then accumulate interest for months, before parents learn of the debt.
A student can easily run up an unsecured debt of £5,000 in a matter of weeks. This debt can haunt parents for years, and ruin a student’s consumer credit information report. Parents need to inform their children about the responsibilities and risks of a credit card, before the students are forced to take out a second mortgage or debt consolidation loans to pay their children’s debt.
Back to school is a great time to teach children that fashion does not define a person. It will not make them popular, but it could put them in debt. There is no reason why a student cannot be taught about APR and interest rates, debt management on mortgages and loans, and of course responsibility.
Permalink
Posted in Consumer Credit, Personal loans, UK Finance, mortgages, Consumer debt, Financial products, Property, Borrowing, Secured loans, Fraud at 1:50 pm by admin
Many homeowners are being encouraged by their brokers to lie about their income in order to secure large mortgages. To lie about your income in order to secure a loan is a punishable offence and could land you with a hefty fine or even a jail sentence.
The whole story revolves around a care worker employed by the citizens advice bureau who claims she was advised by her broker to lie about her salary when trying to secure her mortgage.
Sandra Ashcroft, 59, told her bank she received a £35,000 salary as a mid-wife in order to secure a home loan of £102,000 in 2003. She then applied to increase that mortgage to £122,000 after telling the bank she earned £80,000 working in the public services. Ms Ashcroft actually only earned between £3000 and £5,500.
What Mrs Ashcroft did was highly illegal and she was charged for obtaining money transfers by deception. She was given a six-month suspended sentence but the judge said that there was evidence to suggest that she had been steered towards giving misleading information.
The danger often lies with the temptation offered by self-cert loans and mortgages. These were created for self-employed workers or business owners who don’t always have records of their income. Whilst these loans are vital for those who have an income that doesn’t come from a salaried job, they open a window for people to try to obtain credit they cannot repay by lying on their application.
So if you are thinking of lying on an application for a mortgage or even if your broker is encouraging you to lie do not be tempted. This is a very dangerous route to take and if you are caught out you could face losing your house, ruining your credit rating and even a jail sentence. So always consult the mortgage company or even a lawyer if you are unsure about specific details on your loan application form.
Permalink
Thu 8th Nov, 2007
Posted in Consumer Credit, UK Finance, interest rates, mortgages, Remortgaging, Inflation, Homeowners, House buying, First time buyers, Property, Financial news, Housing news, Borrowing at 1:57 pm by admin
First time buyers paid £162,055 in May, 2007, while the average price paid by former homeowners who are moving up averaged £235,095.
UK house price inflation for first time buyers is unchanged, at 11.2 in May, 2007. The price holding from the increase of 1.3 per cent between April and for first time buyers .
The inflation rate for homeowners moving up fell from 11.3 per cent in April to 10.8 per cent, a 0.6 per cent increase, compared with an increase of 1.1 per cent over this period last year.
The adjusted average house price in May 2007 was £211,056, up from £209,454 in April 2007. UK annual house price inflation in May 2007 was 10.9 per cent, down from 11.3 per cent in April 2007.
The annual numbers in London were 14.5 per cent in May, up from 14.0 per cent in April.
England, Scotland, and Wales saw decreases in inflation in May 2007. The inflation rate in England fell from 10.0 per cent in April to 9.8 in May; the inflation rate in Scotland fell from 17.8 per cent to 15.5; in Wales the rate fell from 9.0 per cent to 8.9 per cent .
Adjusted average house prices in May were £218,225 in England, £163,852 in Wales, £157,974 in Scotland and £229,519 in Northern Ireland.
The English region with the highest average house price in May remains London at £324,084. The lowest average price was in the North East at £146,023.
This still forces first time homebuyers to take out home loans that are four or five times their annual income.
Permalink
Posted in Consumer Credit, Personal loans, Banking, UK Finance, Credit Card, Financial news, Borrowing, Personal debt, Secured loans, Negative equity, Debt management at 1:55 pm by admin
According to the latest research from Abbey most of us here in the UK don’t know much about our own personal finances.
In a survey of more than 1000 British adults a 10 question personal finance exam was set with a grading system similar to that of the GCSE standard. Questions on the survey ranged from credit card interest, secured loan repayments and negative equity.
One in ten Britons had deficient knowledge of their own personal finances scoring below a C grade. 25 percent achieved an A*, 30 percent scored A and 21 percent scored a B. The remaining 24 percent who scored below a B grade are in danger of making bad financial decisions due to their lack of information.
A bank spokesman claimed that the questions chosen were ones that Abbey felt everyone who has a current account should be able to answer. The hardest questions on the survey are related to pay back time of credit card balances before fees could be charged, which is 6 weeks in case you are wondering. Almost half of those surveyed did not know what negative equity meant and possibly the most worrying of all was that 23 percent of us are unaware that non-repayment of a secured loan could possibly lead to losing the house the loan is secured against.
So before you go and get yourself a loan make sure you understand all the terms and conditions. Otherwise you could be in for quite a shock.
Permalink
Fri 2nd Nov, 2007
Posted in Consumer Credit, UK Finance, mortgages, Homeowners, Buy to let, First time buyers, Property, Financial news, Housing news, Tenant loans at 2:11 pm by admin
The strong demand in the rental industry is shown in the latest figures on void periods (the number of weeks that a rented property remains empty each year). Voids have been falling steadily over the past nine months, according to research by Paragon Mortgages. The annual average void period is now between 2.6 and three weeks. Tenant demand will remain high as property prices increase.
Keith Astill, managing director of UCB Home Loans, a subsidiary of Nationwide building society, said:
“People are renting for longer because it’s more difficult to afford to buy, which is in turn providing a boost to the buy-to-let sector.”
Halifax claims that UK property inflation is 10.7%. The figure is higher in Scotland, where house prices are have been increasing 15.9% a year.
Higher prices boost the value of the property, but also squeeze yields, decreasing the percentage of house price covered by the rental income. Yields dipped to 5.5% over the past 16 months, from 5.7% in June 2006, according to Birmingham Midshires.
This despite the fact that rents are on a steady increase, with the average increase of 4.5% in the last year to an average of £651 a month.
Tim Crawford, group economist at Birmingham Midshires, said:
“The fundamentals underpinning the buy-to-let sector remain sound. While house price growth is expected to be more subdued near term, reflecting the impact of higher interest rates, the potential for further increases in rents should encourage long-term investors.
“There also remains the potential for healthy long-term capital appreciation in the buy-to-let sector, particularly given the backdrop of more households being formed each year than there are new properties being built.”
Permalink
Posted in Consumer Credit, Homeowner Loans, UK Finance, mortgages, Homeowners, House buying, Financial products, First time buyers, Property, Financial news, Housing news, Borrowing at 2:08 pm by admin
Two set of figures out this week show that an increasing amount of first time buyers are facing a difficult path ahead with the gap between earnings and house prices continuing to grow.
Mortgage repayments have consumed the greatest proportion of take home pay for the last 17 years. The lowest earners as well as first time buyer couples now typically need to use their joint salaries in order to be able to afford the repayments on a home loan according to research out by the Royal Institution of Chartered Surveyors (Rics).
A separate study out this month from the TUC also shows that the average price of a house in the UK has gone up more than four times faster than that of the wage of the average UK employee over the past 10 years.
The Rics study found that in order to cover the stamp duty, cost of a deposit and legal fees, a first time buyer will typically need to save £25,600. A couple in the lowest earning bracket will earn roughly £25,899 a year between them which is only £299 more than the minimum required to purchase a house.
Some areas of the UK are better for affordability than others. In the North-West upfront buying costs make up 72.9% of the average couple’s joint income, but in other areas there is a very different story.
London which has been the driving force behind massive house price inflation also has the worst affordability issues with the average upfront buying cost in the area of 112.1% of joint take home pay. For these people, even getting an interest-only loan on a property seems an impossible dream.
Permalink
