Secured loans market rocketing
November 28, 2007 by admin
Filed under News, News-Loans
The personal secured loan market in the UK is predicted to grow to in excess of £10 billion by 2011, it has emerged.
Information collected by Datamonitor revealed that the growth in this type of loan from £7.5 billion in 2006 is prompted largely by increased demand to consolidate debt.
This growth is remarkable particularly because some lenders have pulled out of the market following the sub-prime crisis that hit the US this year, making lending increasingly tight.
Maya Imberg, analyst with Datamonitor’s Financial Services practice, commented: “The US sub-prime mortgage crisis and global credit crunch will affect the market in the short term.
“However the UK secured personal loans market continues to portray an encouraging future in the long term.”
Among providers pulling out of the secured loan market are Kensington Personal Loans, the London Mortgage Company, Southern Pacific Personal and GMAC-RFC.
Meanwhile, those looking to take out a secured loan will find prices going up with tighter borrowing criteria, making it increasingly difficult to do so.
UKSIF plans week to promote greener investments
November 27, 2007 by admin
Filed under News, News-Banking
The UK Social Investment Forum (UKSIF) is to run the first National Ethical Investment Week next year, it has emerged.
Members of financial professions will be encouraged to raise awareness of the variety of green and ethical investment options available during the week, which will take place between May 18th and 24th.
The initiative has received the backing of some of the industry leaders in ethical and green investment products, such as Friends Provident, Norwich Union and Henderson Global Investors.
George Latham, head of SRI at Henderson Global Investors, commented: “The evidence can no longer be ignored: consumer interest in sustainable and responsible investing is continuing to grow rapidly.”
“This initiative is a welcome and necessary contribution to the ethical debate, raising the profile of the industry and underlining that investing with a conscience can be a powerful and profitable catalyst for change,” Mr Latham added.
Meanwhile, fund propositions manager at Norwich Union, James Dalby, said that the week would help dispel the “many myths” that surround ethical investment, which he said are “generally untrue”.
Christmas costs falling
November 27, 2007 by admin
Filed under News, News-Loans
The real cost of Christmas is falling steadily after taking inflation into account.
According to recent research by Halifax Unsecured Personal Loans, the price of the UK’s favourite gifts has continued to fall.
The study found that the price of games and toys has fallen most in the last year, dropping by six per cent, with woolly jumpers and socks falling in price by four per cent.
Indeed, in the past decade, the price of toys has gone down in real terms by 45 per cent, with spirits down by 26 per cent and brussel sprouts by 18 per cent.
“Our research shows that the cost of traditional Christmas favourites has actually fallen – good news for Christmas shoppers.
“However, just because the real price of items such as toys, CDs and Christmas cake has fallen, doesn’t mean we don’t need to budget and organize our finances.”
Halifax states that Christmas is as good a time as any to sort out finances, adding that it should not need to take up more time than decoration a Christmas tree.
CML: FSA findings a ‘wake-up call’
November 27, 2007 by admin
Filed under News, News-Mortgages
The Council of Mortgage Lenders (CML) has responded to the Financial Services Authority’s (FSA) publication of case studies of good and bad practise in mortgage brokers’ treatment of consumers.
It welcomed the publication, saying that it would act to help improve the quality of overall service.
The CML will support any action against brokers who fall short of targets outlined by the FSA and brought to their attention.
It states that good brokers’ practise is undermined by those who fail to meet industry standards.
Director general of the CML, Michael Coogan, commented: “After three years of regulation, the FSA is right to expect its regulatory standards to be in place across the whole market. These findings are a wake-up call to those brokers who are behind the pace.”
He added that the FSA must ensure its expectations are explained with clarity, a stipulation especially important for small broking firms.
Banks, building societies and other lenders make up the membership of the CML, which supervises 98 per cent of all residential mortgage lending in the UK.
Officials warn of potential fraud alert amongst UK families
November 27, 2007 by admin
Filed under News, News-Loans
According to a recent report many UK families with children aged under sixteen have been placed on fraud alert after it was revealed that HM Revenues and Customs have lost two discs containing data on all families in the UK with children aged under sixteen, with a range of other related details.
This comes just weeks after it was revealed that discs containing pension details and personal details of pension customers with Standard Life had gone astray, and HMRC and Standard Life had to contact customers to put them on alert.
The data on the latest discs that have gone missing related to child benefit, and amongst the details thought to be contained on the discs are names, addressed, national insurance numbers, dates of birth, and in some cases bank account details. The Chancellor of the Exchequer, Alistair Darling, stated that there was nothing to say that the discs had fallen into the hands of criminals, but he did warn families to be vigilant to avoid becoming the victims of fraud.
Mr Darling made an emergency statement to MPs relating to the issue, and stated: “The missing information contains details of all Child Benefit recipients: records for 25 million individuals and 7.25 million families. ”
He also expressed his own disappointment with what had happened, apologizing for the situation and stated that the incident was an “extremely serious failure on the part of HMRC to protect sensitive personal data entrusted to it in breach of its own guidelines”.
He told MPs: “Two password protected discs containing a full copy of HMRC’s entire data in relation to the payment of child benefit was sent to the NAO, by HMRC’s internal post system operated by the courier TNT. The package was not recorded or registered. It appears the data has failed to reach the addressee in the NAO.”
Tom Smith
27th November 2007
Popularity of equity release in the rise
November 26, 2007 by admin
Filed under News, News-Mortgages
According to a recent report the popularity of equity release schemes is on the up, and experts state that the quality and service in this area is also improving.
Equity release schemes have gained a bad reputation and have been at the centre of controversy, with one equity release provider recently being fined by the Financial Services Authority for giving inaccurate advice to consumers. However, despite its poor reputation equity release is becoming a hit with older homeowners.
According to Norwich Union these equity release schemes are particularly popular with homeowners that are close to retirement. In a survey of 1600 people between the ages of 50 and 56 one in ten stated that they would consider equity release programmes in the future. These schemes were not as popular with those that had already retired, with survey results showing that only one in twenty retired consumers would look at equity release.
One equity release worker stated that the information provided to consumers these days is far more detailed and comprehensive.
She said: ‘The market today is very different. The paperwork given to customers before they sign goes so much further. It really shows what they’re getting into.’
A Prudential equity release customer also said: ‘I was afraid of the financial bits, but my neighbour sat in on one of the meetings. It told me how much I could draw down and I’ve taken about a third of an agreed maximum.’
She added: ‘The compound interest rate is the nasty bit. The man from the Pru worked out that on average I’m likely to live another 27 years. He then told me how much I’d owe, based on the interest rate, if I borrowed varying amounts over various times.’
Alan Wright
26th November 2007
Northern Rock fined widow £800
November 26, 2007 by admin
Filed under News, News-Banking
An elderly widow has expressed her anger after stricken bank Northern Rock fined her £800 in the midst of the chaos in September after she withdrew her savings from the bank.
After it became public knowledge that the bank had borrowed money in the form of an emergency loan from the Bank of England panic set in amongst those with savings in the bank, and many of the bank’s 1.5 million customers quickly withdrew their savings. One of these savers was seventy six year old Mrs Heather, who had tens of thousands in savings with Northern Rock.
Mrs Heather had £173,000 saved in a thirty day notice savings account, and was therefore aware that if she withdrew the money right away she would face hefty penalties. She therefore contacted Northern Rock and asked them to keep the money in the account for the thirty day period and then send a cheque out to close the account, so she effectively gave the required thirty day notice period.
However, a week later she received a cheque for the money in the post, and given the bank’s position thought that they must have decided to waive the thirty day period in light of what was going on. However, when she then asked the bank for a closing statement she realised that Northern Rock had in fact fined her £800 for withdrawing her cash early, even though she had given notice and the mistake had been on the part of the bank.
She said that she called the bank to complain: ‘The lady I was speaking to apologised, but then got very officious and said I should have sent the cheque back to them after I received it. She was very bombastic. So they expect a 76-year-old housewife to know when they have made a mistake – even when they fail to send out a statement showing what they have done?’
Alan Wright
26th November 2007
Another drop in Northern Rock shares
November 25, 2007 by admin
Filed under News, News-Banking
Following the turmoil and chaos that took hold in September of this year, high street lender Northern Rock has seen its share prices plummet yet again, this time falling to their lowest level yet.
According to recent reports shares in Northern Rock, which were worth £12 back in February of this year, fell to under £1 per share on Tuesday. This comes in the light of concerns over whether the bank will be bought out, as although there have been a number of potential purchasers there has been no firm offer as yet.
The serious woes faced by Northern Rock began in September, after it became widely known that the lender had approached the Bank of England for an emergency loan of billions of pounds. Once this became public knowledge, savers flocked to the bank to withdraw their savings amidst worries that the bank was about to fold, and over the space of several days over £2 billion was withdrawn from the bank.
Share prices also plummeted, and Northern Rock gained a reputation as one of the highest profile victims of the credit crunch and the turmoil that has swept across the financial sector.
One bank official stated: ‘Based on the information it has so far, the board of Northern Rock believes that the range of values for the existing equity implied by the proposals is materially below the market price at the close of business on Friday.’
Chairman Bryan Sanderson added: ‘The value to shareholders from any proposals… remains highly uncertain and will be dependent, among other things, on when and if there is an improvement in market conditions including access to liquidity and the value created, if any, from the run-off of the assets and liabilities remaining in the company following any disposal of all or part of its business.’
Tom Smith
25th November 2007
FSA clamps down following mis-sold sub-prime mortgages
November 25, 2007 by admin
Filed under News, News-Mortgages
The UK’s financial regulator, the Financial Services Authority, has come down hard on a handful of brokers that have been found to be mis-selling sub-prime mortgages in an already volatile financial market.
Chaos has resulted from a credit crunch that was sparked in the sub-prime mortgage sector of the United States. In fact, of the three brokers that have felt the wrath of the Financial Services Authority over this issue, one has been closed down altogether whilst the other two have been fined.
The three small brokers include Homebuyer Securities, which was closed down as a result of mis-selling sub-prime mortgages, the Loan Company, and Next Generation Mortgages. The latter two were fined by the FSA but remain in operation.
According to FSA officials the firms had been offering inadequate sales and advice procedures, and as a result of this had put their customers at risk. The companies were all found to be mis-selling sub-prime mortgages, which are mortgages that are targeted towards those with poor credit and those that are unable to prove a regular income.
An official from the Financial Services Authority stated: “Firms who do not comply with FSA standards taint the entire mortgage industry which is totally unacceptable. Any firms who place their customers at risk of receiving unsuitable advice through inadequate business processes can expect strong action from the FSA.”
According to a recent report a fine of £31,500 was imposed on the Loan Company, which was found to be offering inconsistent information and providing mortgage loans without checking that the borrower could afford to make repayments.
A further fine of £10,500 was imposed on Next Generation Mortgages, which was accused of failing to assess customers’ needs properly and failing to provide warnings about the risks associated with its mortgages.
Alan Wright
25th November 2007
Customers can save for Christmas with the Post Office
November 25, 2007 by admin
Filed under News, News-Banking
Over the last few years the Post Office in the UK has diversified into a variety of different areas, and in a recent announced the Post Office has stated that consumers will be able to start saving for Christmas 2008 with a Christmas savings club that is to be launched by the Post Office service.
The service will allow consumers to deposit their cash into any of the fourteen thousand branches of the Post Office, but they will not be able to access the money again until November of next year.
Once they have saved the money consumers will be able to spend it either by using vouchers or via a pre-paid debit card that will be accepted by over two hundred retailers. The account provided by the post office will be protected, and will only be accessible by the customer. Those wishing to save through this scheme will receive a Christmas Club card, which can be used to make deposits at Post Office counters.
There will be a minimum deposit level of £5.00 and a maximum level of £500. Savers will be able to put away a maximum amount of £1000 per club card. According to officials from the Post Office service there is a gap in the market for this type of scheme since the collapse of Farepak last year. Members that use this scheme will be able to access their funds from 1st November 2008.
One Post Office official stated: “As one of the UK’s most trusted brands with an unparalleled retail network, we are responding to the need for a safe and convenient way for people to put money aside for Christmas.”
Tom Smith
25th November 2007
