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Wed 23rd Jan, 2008
Posted in Bad Credit, Consumer Credit, Personal loans, Banking, UK Finance, interest rates, Consumer debt, Unsecured loans, Financial news, Borrowing, Personal debt, Secured loans, Bank charges, Debt management, Missed payments, Overdrafts at 1:33 pm by admin
There has been a lot of controversy in recent months over the amount banks are charging us for going over or credit card limits. A test case is in the high court at the moment and the outcome of that case will be the deciding factor, with regards to whether or not the fees our illegal or not.
Research out today has sown that customers who have been charged fees paid an average of £742 over he past six years. This amount covers charges for what banks term ‘breaches’ and include unauthorised overdrafts, bounced cheques and direct debits that are not paid on anything from phone bills to personal loan repayments
Banks have expressed anger at the research, considering it comes at such a sensitive time, just as the banking industry is going to the High Court to decide the fate of these charges. Angela Knight, Chief executive of the British Bankers Association has claimed the figures are dangerous and misleading.
The worst bank for charges is Abbey where customers have paid an average of £1,376 in charges over the past six years. Lloyds TSB came in second with customers there paying an average of £800 over the same period.
Even more shocking is evidence that some customers, roughly one in twenty, have been charged at least £2,500 over the last six years.
Roughly four in ten bank customers have incurred a penalty fee since 2001. If you are facing financial difficulty then you could consider taking out a loan to help avoid getting too deep in debt, as well as the bank fees you might end up with a bad credit rating.
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Fri 18th Jan, 2008
Posted in Consumer Credit, Homeowner Loans, UK Finance, interest rates, mortgages, Remortgaging, Inflation, Homeowners, House buying, First time buyers, Property, Financial news, Housing news, Borrowing, Secured loans, Negative equity at 1:47 pm by admin
This is probably a burning question for most of us out there since our house is not only a roof over our head but also the largest investment we will probably ever make.
Up until 8 months ago it appeared as if the house price boom would never end with over a decade of record breaking growth in house prices.
However more recent figures coming out in the past two months paint a gloomier picture. If you are a mortgage holder then this could be a cause of great concern as you may end up owing more on your home loan than the value of your house: i.e., negative equity.
Meanwhile the US has seen a decade of growth starting to turn and house prices in many areas of the US are falling as the global credit crunch takes its first victims. Right now in the US there is a record number of mortgage defaults and this is going to start having an effect on us here in the UK as the cost of borrowing goes up.
The Royal Institution of Chartered Surveyors (Rics) has said that nearly half of its surveyors saw price falls in December, the worst figures since late 1992.
Interest rate rises and a tightening of lending criteria are thought to be the main causes of the market drop, with lenders reporting a drop in loan approvals.
The Halifax and Nationwide also reported seeing a weakening of the property market, and recent Government data from
“The housing market is clearly feeling the pinch from the credit crunch and the round of interest rate hikes in 2007,” said Rics spokesman Ian Perry.
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Wed 16th Jan, 2008
Posted in Consumer Credit, Homeowner Loans, UK Finance, interest rates, Remortgaging, Homeowners, House buying, Financial products, First time buyers, Property, Financial news, Housing news, Borrowing, Secured loans at 12:19 pm by admin
A brief look at the UK mortgage market will show that less and less fixed rate deals are being offered by banks to customers. Added to this is the fact that many of the deals that are offered look extremely unattractive to borrowers because the rates are just seen as being too high. However, research shows that the best fixed rate loans are not that far higher than the variable rate deals and there are still some good deals out there to be had. The problem is that these deals are often only offered for a very short period by the bank and customers are not having the time they need to take up the offers.
Another issue with the fixed rate deals that are available is that many of them are charging very high fees. It looks as though if you want a fixed rate mortgage these days, you are going to have to pay a hefty premium just to get your hands on one. Most fixed rate home loans are also charging fairly punitive early redemption fees so if you think that you are going to be moving again in the near future, or want to have the choice of re-mortgaging your home when rates are lower, the option may not be open to you.
The best advice is simply to decide very carefully what type of mortgage you need, and not simply chase the lowest rates. If you cannot afford the risk of another rate rise, then opt for a fixed rate, even if it means paying high fees.
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Posted in Consumer Credit, Debt Consolidation, UK Finance, Credit Card, interest rates, Financial products, Balance transfer, Financial news, Borrowing, Bank charges, Debt management, Zero percent cards at 12:16 pm by admin
According to a report from MoneyExpert.com, banks made more than £239 million in transfer fees from credit cards offering zero percent interest rates in Britain in the last year.
Many customers choose a zero percent interest rate credit card to help manage their finances, however many credit card companies are charging customers transfer fees of up to three percent of the balance. If someone with a £5,000 debt is charged 3% they will then have to pay a fee of £150. The Office of Fair Trading is considering looking into these fees.
Many consumers who want to save money on their interest payments and manage their debts have used a zero percent balance transfer deal. Almost all credit card providers who offer zero percent balance transfers now charge a handling fee anywhere from two percent to three percent of the balance being transferred. The balance transfer handling fee became widespread after banks and building societies were hit last year by the Office of Fair Trading on charging penalty fees, so the banks then sought another source of income, which has come to be the transfer fees on zero percent balance transfer cards. According to the report almost 12 million people have switched credit cards over the past year with an average fee of £19.99.
Balance transfer credit cards are ideal for those who have large sums that they want to pay off and avoid paying interest on. However, as you are searching for a credit card with a zero percent balance transfer you will want to compare the handling fees that the credit card provider will charge as some will only charge a flat rate, while other will charge a percent of the amount being transferred.
Bear in mind too how long you realistically expect to take to pay off the debt. You may know that the 0% period only offers you a break from paying interest and that you cannot clear the outstanding sum in that time. If so, you will want to calculate how much interest you will be paying once the period is over. It may cost you less money and hassle to arrange a debt consolidation loan. Although a loan will attract interest from day one, at least you are committed to a set period to repay at a rate that won’t change.
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Thu 10th Jan, 2008
Posted in Bad Credit, Consumer Credit, Personal loans, Homeowner Loans, Banking, UK Finance, Credit Card, interest rates, mortgages, Consumer debt, Homeowners, Financial products, Spending, Credit record, Unsecured loans, Borrowing, Personal debt, Store cards, Secured loans, Bank charges, Debt management, Missed payments, House repossession, Tenant loans, Overdrafts at 2:06 pm by admin
Before signing any contract or deal you are always told to read the fine print, and this is for a good reason. Most of the important information that is almost always overlooked is mentioned in the fine print of the document. Often this may include default terms or the eligibility of a good interest rate offer on a cheap loan or credit card. It is estimated that as much as six million consumers fail to read the small print of their contract or transaction.
A recent study reveals that more than fifty percent of adults admitted to not reading the small print when buying financial products, mobile phones or electrical goods. This is disturbing as often the lack of understanding of the fine print in your contract can lead to major problems or, in extreme cases, financial ruin. Once a repayment contract on a credit deal – such as a mortgage or personal loan – has been breached, penalties and charges can snowball, putting the consumer at risk of losing their home.
One of the most important contracts where fine print must be completely understood is the credit card agreement. All credit card companies are in the business to make a profit off their customers and with the Office of Fair Trading cracking down on unfair charges, credit card companies must then find other ways of making a profit. Some of these ways include cash withdrawal fees, foreign usage charges; higher interest rates if the cardholder defaults as well as shorter interest-free periods. It is important that consumers first read over the fine print of the credit card agreements before activating an account. Often credit card holders fail to read over their agreements properly and overlook items such as handling fees for balance transfers or the high interest rates that are charged on cash withdrawals, and in some cases credit card providers are allowed to reprice a contract should the cardholder default on payments, which means they can then start charging a higher interest rate.
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Posted in Consumer Credit, Personal loans, Banking, UK Finance, Credit Card, interest rates, mortgages, Savings, Financial products, Spending, Unsecured loans, Financial news, Borrowing, Secured loans, Bank charges, Debt management, Tenant loans, Overdrafts at 2:03 pm by admin
No matter who you are, when it comes to your personal finances, so much depends on the deals that you get from your bank. With just a few big high street banks out there dominating the market, you should really pay attention to the deals that they are offering you on your financial services.
A new report by the Daily Mail shows that most of the high street banks have some excellent deals out there on some of their products, they also have some really terrible deals that will be offering customers terrible value for money and will not be very good financial choices.
Whether you are looking for a personal loan, paying off your credit cards and looking for a better rate while you do so, or simply like to save a few pounds each month for rainy day, by carefully selecting what you say yes to and what you say no to, you will be able to take the good while avoiding the bad deals that are available from the banks.
For example, while the Abbey is paying 7.25% pre-tax on its fixed rate monthly saver account - an excellent rate in the current market - it reduced the rate that it pays on its instant access Isa at the end of May from 5.6% to 4.55% and 5.25%. This is a huge difference on what you will be paid from the same institution.
Meanwhile, other lenders are focusing their advertising on the great rates they are offering on loans and mortgages, whilst putting the high arrangement fees in the fine print.
It pays to look closely at what your bank is offering and not assume the your own bank offers exactly the same products as the others. It is fine to shop around. It is virtually certain that some of the offers they give you will be great, and some will be terrible, so read them, be a discerning consumer, and choose the options that suit your needs.
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Posted in Consumer Credit, Personal loans, Banking, UK Finance, Credit Card, interest rates, Savings, Financial products, Spending, Unsecured loans, Financial news, Borrowing, Secured loans, Bank charges, Debt management, Tenant loans, Overdrafts at 2:03 pm by admin
No matter who you are, when it comes to your personal finances, so much depends on the deals that you get from your bank. With just a few big high street banks out there dominating the market, you should really pay attention to the deals that they are offering you on your financial services.
A new report by the Daily Mail shows that most of the high street banks have some excellent deals out there on some of their products, they also have some really terrible deals that will be offering customers terrible value for money and will not be very good financial choices.
Whether you are looking for a personal loan, paying off your credit cards and looking for a better rate while you do so, or simply like to save a few pounds each month for rainy day, by carefully selecting what you say yes to and what you say no to, you will be able to take the good while avoiding the bad deals that are available from the banks.
For example, while the Abbey is paying 7.25% pre-tax on its fixed rate monthly saver account - an excellent rate in the current market - it reduced the rate that it pays on its instant access Isa at the end of May from 5.6% to 4.55% and 5.25%. This is a huge difference on what you will be paid from the same institution.
Meanwhile, other lenders are focusing their advertising on the great rates they are offering on loans and mortgages, whilst putting the high arrangement fees in the fine print.
It pays to look closely at what your bank is offering and not assume the your own bank offers exactly the same products as the others. It is fine to shop around. It is virtually certain that some of the offers they give you will be great, and some will be terrible, so read them, be a discerning consumer, and choose the options that suit your needs.
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Thu 3rd Jan, 2008
Posted in Consumer Credit, Personal loans, Homeowner Loans, UK Finance, interest rates, mortgages, Remortgaging, Inflation, Homeowners, House buying, First time buyers, Property, Financial news, Housing news, Borrowing, Secured loans at 3:15 pm by admin
The outlook for house prices is uncertain after a summer in which we saw a further rise in interest rates as well as global turmoil in the credit markets.
Mortgage lending throughout the summer remained strong and with the five interest rate hikes over the past 12 months we have seen house price inflation return to more sustainable levels. Whilst December’s rate drop has provided relief for inter-bank lending, it has had little or no impact on householder costs or on house prices. Recent remortgages of home loans will still see borrowers facing higher charges than when they first set up their loans.
The prospects of higher interest rates as well as the introduction of Home Information Packs at the beginning of August meant that July saw a rush of property owners moving to sell their houses before the HIPs were introduced as well as many people switching mortgages to minimise the impact of further interest rate rises.
However warnings have been sounded about the future of house prices. We may be in for a difficult New Year as the impact of 5 rate rises begins to take its toll on the demand for new mortgages as more and more of us find it increasingly difficult to afford them.
Other European countries which have experienced a boom in house prices in recent years such as Spain in Ireland have both began to show signs of slowing down and there are signs that the UK housing market may also follow in that path.
It is impossible to tell how the housing market will go. The Bank of England reported that the figure for new mortgages for people moving house in July was similar to the monthly average for the past six months, standing at 115,000. Only looking at this figure might imply that there is no slowdown, however many other economic indicators tell a different story.
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Posted in Consumer Credit, Homeowner Loans, UK Finance, interest rates, mortgages, Remortgaging, Homeowners, House buying, Financial products, First time buyers, Property, Borrowing, Secured loans at 3:04 pm by admin
If you are considering taking out a mortgage then it is important to be armed with as much information as you can possibly get. Since buying a house is more than likely the biggest financial investment you are going to make in your life then understanding what offers are available to you could end up saving you hundreds over the lifetime of the plan.
Educate yourself on how a mortgage works and do some research before approaching a broker for advice. If you have already got a mortgage you should use this as your benchmark or find out the best offer you can possibly get and then approach a broker.
Getting a mortgage over the internet is slightly risky if you are not completely up to date with all the deals so using a broker can be a far safer option.
Finding the right broker for you is important and a good way of judging a broker is by asking two simple questions; Firstly, do they cover the whole of the UK market? Not all brokers are ‘whole of market’ and if they are not then it would be advisable not to use them.
Secondly ask the broker how they make their money. Brokers typically have two ways of making money. The first way is through commission in which lenders pay the broker a procurement fee which is usually a percentage of the loan’s value. The other way brokers can make their money is by charging a fee directly to you. Never pay more than 1.5% for a fee even if you have a bad credit rating. While fees can be charged at any stage of the process, the later the charge the better.
The best answer you can hope for is if the broker only earns commission and charges no fee and is also whole of market. This way you can be sure that the broker is giving you the best advice available since they are able to assess the whole home loans market. Also the only charge you will be paying is a percentage commission and not a fee on top of that.
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