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Thu 9th Oct, 2008
Posted in Consumer Credit, Personal loans, Homeowner Loans, UK Finance, Credit Card, mortgages, Remortgaging, Homeowners, House buying, Financial products, First time buyers, Credit record, Property, Financial news, Housing news, Borrowing, Secured loans at 1:27 pm by admin
The house price crash is proving to be a boon for many potential first time buyers. Those who have waited for years, ever-frustrated as house prices have rocketed beyond their reach are at last seeing a chance to buy.
With house prices having fallen eleven months in a row (according to figures from Nationwide), buyers poised to step on that first rung are waiting in the wings. So what are market conditions really like?
Well, according to the financial papers, prices are set to still fall, which is why many potential buyers are still holding back.
This may be bad news for those desperate to sell, but for those looking to finally be handed the keys to their own home, the news is great.
Many of these would-be purchasers have been saving up for years, watching prices soar further and further beyond their reach. Provided that they haven’t given up and dipped into their funds, they could be on track to buying their dream home in the next year.
One of the only dampeners that buyers should be aware of is the difficulty right now in getting a loan. Existing home loan borrowers have an easier time, should they find a buyer, as they have a proven credit record on their side and probably a chunk of equity in their property.
Lenders are now asking for as much as 25% deposit - compared to the 100% or even 125% loans that were being offered when prices were still rocketing. Unless you have a good credit record and a hefty chunk of savings, your dream property might not be as close as you think.
So, potential buyers could be wise to use their credit cards and take out cheap personal loans - provided always that they make repayments promptly. By building up a good credit record before they look at getting their home loan, they stand a great chance of getting that mortgage approval they need.
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Wed 10th Sep, 2008
Posted in Bad Credit, Consumer Credit, Personal loans, Homeowner Loans, UK Finance, Credit Card, interest rates, Consumer debt, Credit record, Property, Unsecured loans, Borrowing, Personal debt, Secured loans, Debt management, Missed payments, Tenant loans at 1:34 pm by admin
There’s a lot of confusion about credit ratings amongst people seeking personal loans and other forms of credit.
Many people believe - wrongly - that a credit record shows whether a lender has refused credit. This is not the case. Every time you apply for credit a ‘footprint’ is created on your credit record to show other financiers what you have been up to, but no record is immediately made as to whether you took up an offer, or whether it was refused.
One thing that varies from lender to lender is ‘how much is too many?’ Most of us are familiar with the concept that lenders looking at a credit record showing multiple applications may - quite rightly - view this as a sign of someone desperately seeking credit. As this is rarely the sign of a good potential client, many lenders will turn this applicant down on principal.
But how much is ‘too many’ when it comes to applications. Lenders will obviously vary, according to their criteria, but a flag usually goes up if more than four applications have been made at any one time. If the applications are spread across a period of months, the lender will be more lenient.
Another factor that people misunderstand about their credit rating is how much stability affects their core rating.
When you apply for credit - be it a mortgage, a credit card or a personal loan - the lender wants to know more than anything that you will be able to repay. The greater the risk perceived, the higher the interest rate charged, which is why bad credit loans can be so expensive.
Factors affecting this can be whether you are married - a sign of committment - whether you are registered as a voter, how many times you have moved house and even how many times you have moved job.
Someone who is seen as high risk is not necessarily someone with a history of missed repayments and ccjs, but maybe someone who has jumped from job to job, moved house or town many times and generally shown a lack of stability.
So, if you’re wondering why you weren’t offered the best rates available on the loan you wanted, you may need to look deeper than you thought.
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Mon 9th Jun, 2008
Posted in Bad Credit, Consumer Credit, Homeowner Loans, UK Finance, interest rates, Remortgaging, Consumer debt, Homeowners, House buying, Financial products, Credit record, Property, Financial news, Housing news, Borrowing, Personal debt, Secured loans, Missed payments at 1:07 pm by admin
Banks are getting increasingly tough on borrowers, and with high interest rates, mortgages are becoming increasingly expensive to service. So what options have you when looking for a new mortgage deal?
With lending rates so high at the moment and not expected to come down for a while, a tracker mortgage would probably not be the right option for anyone who cannot afford increased payments in the short term. Instead, taking out a short-term fixed rate loan would be a wise choice, to avoid being stung by higher repayments in the coming months.
If you have been in arrears recently then switching might be a bit more of a tricky issue since most lenders are now getting a lot tougher on borrowers with blemished credit records. Bad credit mortgages are available, but after last year’s sub-prime losses in America, these tend to be offered at very high rates.
You might not be able to take advantage of the cheap deals out there if you have recently gone into arrears or missed a payment, however there are still some sympathetic lenders out there who are willing to ignore the odd blemish on your credit history so make sure you shop around when you are looking for a good deal.
HSBC is currently offering something called a “RateMatcher” policy, which allows mortgage customers about to come to the end of fixed-rate mortgage to extend their loan for another one to five years at their current rate. This will prevent customers from switching out of an existing good deal to a higher rate elsewhere and should come as welcome relief to anyone whose cheap-rate home loan ends this year.
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Fri 2nd May, 2008
Posted in Bad Credit, Consumer Credit, Personal loans, Homeowner Loans, UK Finance, Credit Card, Consumer debt, Buy to let, First time buyers, Credit record, Property, Unsecured loans, Financial news, Borrowing, Personal debt, Secured loans, Debt management, Missed payments at 4:44 pm by admin
With the number of rejections for applications for credit cards on the rise it is becoming increasing difficult to secure credit.
As banks continue to tighten their belts when it comes to lending borrowers are being warned to prepare for rejection when they apply for a credit card. The people that are going to find themselves most likely to be refused are those with imperfect credit histories.
In the recent past it was assumed by most people that only those who had very bad credit histories, recent first time buyers and some buy-to-let investors were the ones who would find it difficult to secure credit. However times have changed in the wake of the credit crunch and more and more people are finding that they too are being rejected for credit.
Customers applying for cards and personal loans are finding that credit scoring has become tighter, with lenders giving more stringent reasons for turning down an applicant. Last year an applicant might have got away with making the odd late payment on a card or loan and it not affecting their credit score, but this year it’s a different story.
It has been revealed that the number of applications for credit cards that are being rejected has gone up by as much as 17% in the past six months. This means that roughly 3.27 million people across the UK have been refused credit in that period. This is a half a million more people than were rejects in the six months leading up to March 2007. Those of us who are most likely to see or application for credit rejected are people in the 25-34 year old age bracket.
Banks are also becoming increasing choosy over who they are willing to lend money to because the pool of money they have to disburse is so much smaller. With so many people looking for bad credit loans or low-deposit home loans, there are going to be a lot of disappointed borrowers.
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Tue 8th Apr, 2008
Posted in Bad Credit, Consumer Credit, Personal loans, Banking, UK Finance, Credit Card, Consumer debt, Card fraud, Spending, Identity theft, Credit record, Unsecured loans, Financial news, Borrowing, Fraud at 1:22 pm by admin
It has been revealed that Facebook users are putting themselves at serious risk of becoming an unwitting victim of ID theft. Even posting just a few private details on your Facebook page can give fraudsters enough information to cause serious damage.
Using the information that they have come across on people’s Facebook pages, fraudsters are able to open bank accounts and take out credit cards and personal loans in their victim’s name.
The warning was sounded by a BBC1 consumer show Watchdog. The show conducted an experiment in which they set up a fictional identity on Facebook. The Watchdog team then invited 100 random people to become friends with their newly created fictional character ‘Amba’.
35 of those invited to become Amba’s friend immediately accepted the request despite knowing nothing about her. By accepting, the victims allowed the fictional Watchdog character to view any private details that they had posted on their page.
Details which could easily be accessed included date of birth as well as hometown. The Watchdog team then used these details in order to obtain more private details about their victims from other publicly available websites.
With this information Watchdog then opened up an online bank account in their victims’ names as well as successfully applying for credit cards.
One of the victims, Scott Gould, stated that he was “very surprised” by what Watchdog managed to do despite having only the slightest bits of information about him.
Users of Facebook as well as all other social networking sights are advised to be very careful when posting their details. Fraudsters often leave a trail of bad debts behind them, in Your name. Not only is the onus on you to prove that you are not responsible, it is hard work correcting your damaged credit rating.
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Wed 2nd Apr, 2008
Posted in Bad Credit, Personal loans, Debt Consolidation, UK Finance, Credit Card, interest rates, Consumer debt, Financial products, Spending, Credit record, Balance transfer, Unsecured loans, Borrowing, Personal debt, Debt management, Zero percent cards, Missed payments at 12:54 pm by admin
If you are considering switching from your current credit card provider to a new one because you are having trouble paying back your balance then it would be helpful if you were aware of a few pointers first.
Many credit card companies offer very low interest rates on balance transfers; sometime this can be as low as zero percent. But there is a time limit on this balance transfer. So for example if you need six months to pay off your debt and the zero percent interest on balance transfers apply for the first six months then this is an option worth considering. This could possible save you from having to pay back possibly hundreds in interest fees.
Make sure you read the fine print on the deal before signing and take care to make all repayments on time. Missing a payment or paying late can result in the lender replacing your great rate with a much higher APR, leaving your paying more than if you had taken out a debt consolidation loan to clear the original debt.
Another danger is if you do fail to pay back the balance within the given time period the zero percent will revert back to the a much higher rate on the card and sometimes this includes the lender back-charging interest on the first six months of the loan as well. This could result in repayments outweighing the benefit of the zero interest on the first six months.
Lenders do have a responsibility to warn you if the introductory offer of zero percent is about to run out. However as a general rule its better not to trust to this reminder jogging your memory, as it can often be buried in small print. Just make sure you yourself are always aware of the time limit on your offer or one morning you could wake up to a big surprise.
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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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Mon 1st Oct, 2007
Posted in Bad Credit, Consumer Credit, Personal loans, UK Finance, Credit Card, mortgages, Consumer debt, Card fraud, Identity theft, Credit record, Borrowing, Fraud, Zero percent cards at 1:28 pm by admin
Identity fraud is a growing concern in the UK with many Britons falling victim and costing the economy an estimated £1.7 billion a year. One way that people can fall victim is by leaving unused credit card accounts open. According to Apacs, at the end of 2006 31.5 million people in the UK held an average of 2 personal credit and charge cards. However, according to the research there are around one in three cards that are no longer active, which can cause concern for some. One reason why someone may no longer use a credit card account is because they originally opened the account to take advantage of the 0% interest on balance transfers and once the balance was paid off they never used the card because of the high interest rate, or because they transferred the balance over to another 0% credit card once the offer has expired. This means that there are many people who are moving their balances from one account to another account and often forgetting to close the account once it is no longer in use.
If you fail to cancel your cards once you stop using them you may end up forgetting that you ever had them. Often if your account has no activity you will most likely end up not receiving a statement to remind you of the account. So if someone gets a hold of your information and changes the billing address, you will easily miss that and fall victim to identity fraud. Once someone has your details they can easily go further and take out expensive personal loans or even mortgages in your name. Typically these fraudsters will very quickly default on payments, leaving the black marks on your credit record. Often the first you will know of the matter is when you yourself are turned down for loans or mortgages.
One way of protecting yourself is by checking your credit report, and if you find in-active accounts listed on your report, then you should close them the ensure you do not end up a victim of fraud.
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Wed 26th Sep, 2007
Posted in Bad Credit, Consumer Credit, Personal loans, UK Finance, Credit Card, interest rates, Consumer debt, Financial products, Credit record, Borrowing, Personal debt, Debt management, Missed payments at 10:56 am by admin
Credit card providers are now required to show customers just how much interest they are being charged and have been limited to charging customers only £12 on late payments. Although the late payment charges have been reduced there are many customers who are failing to meet their monthly payments, with a total of £230 million being charged in late fees last year. Some may miss their payment simply because they have forgotten, whilst others are struggling to make ends meet on bills and loan repayments. Some may think that a £12 late fee is not much, however the late payment charge is more than an irritant.
If you miss a credit card payment you will find that you will not only be charged the £12 fee, but you may also lose the special rate on your credit card. Often credit card issuers reserve the right to raise your credit card interest rate if you break the terms and conditions of your contract, which will end up costing you more than just a mere £12. You may also discover that your late payment will affect your credit report, and if you miss more than one, lenders may look upon this as a negative mark against you putting you at risk of attracting higher interest rates on other financial products, such as mortgages and personal loans.
One way of ensuring that your payments are made on time is by setting up a direct debit. This way your credit card bill will always be paid on time and you can easily avoid any credit card late-payment fees.
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Fri 25th May, 2007
Posted in Consumer Credit, Personal loans, Homeowner Loans, UK Finance, Credit Card, interest rates, mortgages, House buying, Financial products, Credit record, Borrowing, Secured loans, Debt management, Home Improvements, Missed payments at 9:13 am by admin
Using your credit card responsibly is important in building a good credit rating. If you are trying to rebuild your credit or if you are applying for a credit card for the first time, you will want to make sure that the next time you receive a credit card offer that you pay special attention to the terms as choosing the right credit card will help you build a positive credit history. This means that when you apply for larger sums of credit - eg a personal loan or a mortgage - you will be more likely to get a good rate.
If you receive a credit card application in the post, or if you find one online, and the credit card company is offering a low monthly interest rate you will not want to make an immediate decision based on the rate. The most important way to measure a good credit card offer is by comparing the credit terms, such as the APR, the interest free period as well as any finance charges such as late fees or cash advance fees.
A credit card is an important financial tool as it not only offers the convenience of shopping without carrying around a lot of cash, but it will also help you build the credit if the card is used responsibly. By paying off your balance each month you will avoid having to pay any interest rates or finance charges. These timely payments will also be reflected on your credit report showing your payment history as current, meaning that you have never missed a payment. This is very favourable amongst lenders. You can also help build a good credit history by making on-time payments for other forms of credit, such as your rent or your utility bills. By using these financial tools wisely, you will reap the benefits in the future when you buy a house or take out a home improvement loan.
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