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Wed 5th Mar, 2008
Posted in Consumer Credit, Personal loans, Homeowner Loans, UK Finance, interest rates, mortgages, Homeowners, House buying, Stamp duty, First time buyers, Property, Financial news, Borrowing, Secured loans at 12:57 pm by admin
The chancellor has come under fire and been accused of missing an opportunity by not offering to help first time buyers struggling to get onto the property ladder. The reason for the criticism is that the chancellor decided not to the raise the level of stamp duty from its current level of £125,000.
In his pre-budget report the small print does refer to the possibility of reforms that might allow certain people buying their house through official shared equity schemes to escape paying the tax. Typically this would be public sector workers who increasingly find that their salaries are no match to what they could receive had they worked in the private sector.
A report released by the Council of Mortgage Lenders was released just hours before the Chancellor’s pre-budget report and it warned that first time buyers were finding issues of affordability increasingly difficult to deal with. With house prices having outpaced wages over the last decade and interest rates on loans and mortgages rising, first-time buyers are hard pushed to reach that bottom rung.
Many experts were surprised by the fact that the pre-budget report lacked a reference to stamp duty despite the fact that the Conservatives had pledged to remove it for first time buyers that are worth £250,000 or less.
Halifax has found that the average UK first time buyer now pays roughly £169,000 for their first home. On a property of that value they have to dish out an average of £1,688 in stamp duty, on top of the deposit, moving costs and first home loan repayment.
Some experts have argued that the removal of stamp tax for first time buyers was an ideal way of helping the thousands of people out there looking to get onto the first rung of the property ladder.
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Thu 28th Jun, 2007
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.
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Mon 5th Feb, 2007
Posted in Consumer Credit, Personal loans, UK Finance, Credit Card, Consumer debt, Stamp duty, Credit record, Unsecured loans, Borrowing at 10:50 am by admin
When you are applying for a loan, lenders rely on a credit report when deciding whether to loan you money. Your credit report will decide just how much the lenders will be willing to lend you as well as determining the interest rate that they will charge you. Having a good track record will show just how well you have been repaying other debts and whether or not you will qualify for a loan. If you have no credit history you may not qualify for a loan, and you may find it difficult getting one.
If you have no track record, the best way to start one is by opening a small credit card and paying your monthly charges on time or even paying more than the minimum required. Once you have established a good record with your first card, you can then try for a small personal loan.
Some loans that appeal to creditors when searching your past credit history, are mortgages, debt consolidation loans, bank loans, or credit cards. Mortgages are especially appealing to potential creditors as there will be a long history of payments. Debt consolidation loans can be a good sign to some creditors, it’s a sign that you are serious about getting yourself out of debt. Debt consolidation loans can only be appealing if it was a one-time event. Bank loans are positive as long and you repay them regularly and on time. For creditors, credit cards can be a positive thing so long as you are making regular payments and the balance on the cared is not more than eighty-percent of the available limit.
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Thu 26th Oct, 2006
Posted in Consumer Credit, Homeowner Loans, UK Finance, mortgages, Remortgaging, Consumer debt, Homeowners, House buying, Financial products, Stamp duty, First time buyers, Property, Financial news, Housing news, Borrowing at 11:41 am by admin
The government has said that the Council of Mortgage Lenders (CML) has used ‘questionable’ data in its first time buyer statistics, reports MoneyMarketing. According to the Treasury, many of those classed as first time buyers by the CML are not actually first time buyers. Instead, many are people returning to home buying after renting for a short period, going abroad or staying with family and friends after a divorce. Many of the people listed by the CML, says the Treasury, are buying second homes.
MoneyMarketing previously reported that the CML defined a first time buyer as anyone buying a property but not selling one at the same time. The CML has just published research which shows tremendous differences in the level of stamp duty paid by first time buyers, with many, especially in London, falling into the 3 per cent band.
Meanwhile, the Treasury says it does not recognise the CML’s data on first time buyers as its definition of first time buyers is questionable. A spokesman says: ‘The fact is that as a result of threshold increases made by the Chancellor less than half of first time buyers pay stamp duty.’
According to MoneyMarketing the CML has responded as follows: ‘The Treasury chooses to ignore the key point we were trying to make. All home-buyers, whether they are new entrants, returners or existing owner-occupiers, are paying increasing amounts of stamp duty. If the Treasury doesn’t recognise our data, what is it using? Ours is exactly the same as the FSA’s and uses exactly the same definition as the FSA.’
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Wed 11th Oct, 2006
Posted in Consumer Credit, Homeowner Loans, UK Finance, mortgages, Consumer debt, Homeowners, House buying, Financial products, Stamp duty, First time buyers at 9:47 am by admin
The Council of Mortgage Lenders’ (CML) latest statistics show that the proportion of first time buyers paying stamp duty has increased from 48 per cent to 56 per cent within the space of a year. Only 15 per cent of August home movers did not pay stamp duty, compared with 21 per cent last year.
First time buyers are struggling and only accounted for 35 per cent of August house purchases, though the actual number of buyers increased from 34,900 last year to 38,100 this year. First-time buyers are also finding houses less affordable, with typical income multiples up to 3.27 from 3.08 last August. First time buyers now spend 17.1 per cent of their income on their mortgage, up from 16.5 per cent last August. The average size of a first time buyer loan increased at twice the rate of their income.
CML director general Michael Coogan commented: ‘Interpreting these figures suggests that borrowers are falling into two camps. There are those who believe rates are near their peak, and who are confident enough to risk a short-term rise in rates for the pricing benefits offered by discounts and trackers. And there are those who want greater financial certainty, who may well be increasingly choosing longer-term periods over which to fix their rate.’
He added: ‘Overall affordability has worsened a little, especially for first-time buyers. Over the period of a year, small monthly changes can nevertheless be significant - as the rise in the proportion of mortgage borrowers required to pay stamp duty shows. For the rest of this year, we expect some moderation in activity although the market is continuing to outperform our earlier forecasts.’
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