Barclays offer reduced personal loan rates

Barclays bank has announced it will cut its personal loan rates when many lenders are having trouble maintaining current rates, according to Gary Druggan, managing director at Barclays Personal Loans.

Cutting rates on its entire book, the lending giant steps up competition in a move that takes advantage of its “strong balance sheet”.

The bank reports that Barclayloan Plus loan rates are going down by 0.6 per cent to 6.8 per cent APR typical.

Mr Duggan said: “At Barclays we are able to take advantage of a very strong balance sheet and finance loans from our very strong deposit taking business, enabling us to cut rates for this campaign.”

Personal loan rates have been just one of many things to be affected by recent credit crunch.

With many lenders forced to push rates up by as much as four per cent, borrowers would have trouble finding a rate below 6.9 per cent.

Mr Druggan added that anyone finding better loan rates than offered with Barclays will be refunded the difference and will also receive a bonus of one pound every month.

Tags: personal finance, offer, borrowers, crunch, move, apr, difference

More financial education needed says CCCS

Britons need to be better educated on their financial management, an expert has warned.

According to Consumer Credit Counselling Service (CCCS) spokesperson James Ketchell, many people lack sufficient knowledge when it comes to using credit and assessing whether they can afford it.

Commenting that there needs to be more financial education among young people, he highlighted the difference between managing credit in comparison to a student loan, which provides cheap credit and is automatically deducted out of a borrower’s wage packet.

Mr Ketchell said that it is currently very easy for people in employment to be offered to take on more credit, adding: ” As prices have gone up and wages have stagnated and mortgages have gone up, people have to use a bit more common sense in their financial dealings.”

His warnings come after Credit Action recently stated its assertion that young people in Britain, amidst rising figures of debt saddled by today’s graduates, have been “educated into debt but not about debt”.

Tags: Knowledge, borrower's wage packet, action, packet, personal finance

Rock plight highlights need for building societies

The difficulties of financial firm Northern Rock have underlined the difference between banks and building societies, it has been claimed.

According to Britannia, building societies are a the safer alternative and that could mean that the popularity of the institution could rise.

Commenting on the crisis Emma Taynton-Young, a spokesperson for Britannia building society said: “The recent market has actually strengthened the difference between banks and building societies, and we find it very easy to explain the difference now because it’s shown the effect of the opposite business model to ours.”

She added: “So in a way, yes, building societies are the safer option, and I think this answers the point as to whether the Northern Rock crisis will provoke a rise in the popularity of building societies.”

The firm also claims that the heavy restrictions placed on building societies contribute to the amount of confidence consumers have in them as institutions.

Tags: crisis emma, rise, difference, Social economy, point, britannia building society, building societies, amount

Young buyers mortgage illiterate

Many first-time buyers are mortgage illiterate, according to new research by AA Legal Services.

Those looking to get their first mortgage on a property are confused by certain terms and may not be completely aware of what it is that they are buying.

The research found that 40 per cent of new buyers do not know the difference between a leasehold and freehold property, with those aged between 18 and 24 being the worst offenders.

AA Legal Services has expressed concerns that many young people are feeling the pressure of rising house prices and this may be forcing them into getting onto the property ladder without fully understanding what they are signing up to.

First-time buyers spend an average of £159,653 on their first property but 41 per cent have no idea what freehold means and 43 per cent are clueless as to the meaning of leasehold.

“Our research suggests that many homebuyers are so desperate to get onto the property ladder that they may be over looking vitally important basic legal principals,” commented James Molloy head of AA Legal Services.

The term leasehold means the right to hold or use a property for a fixed period of time according to a contract. However, many 18-24-year-olds thought it meant that the property could be rented out and others believed that it made the house exempt from council tax.

Freehold means that there is no limit to how long the property can be held and remains with the holder until he or she willingly transfers it. Six per cent of 18-24-year-olds thought freehold meant exempt from capital gains tax, while two per cent thought that only freemasons could buy freehold properties.

Tags: first mortgage, property ladder, leasehold, legal, difference, ladder, Many first-time buyers

The death of DIY?

The Great British love affair with DIY may be coming to an end as people become more concerned about making a claim on their home insurance.

Research by Woolwich Mortgages shows that more and more people are turning their backs on DIY and opting to get professionals in to do the job instead.

Nearly half of those questioned said that they do not enjoy DIY, with 37 per cent avoiding the work in case they get it wrong and have to claim the money back from their insurer.

A further 40 per cent say that they simply do not have the time, while 22 per cent see DIY as a chore that takes up valuable leisure time.

“It seems that the phrase ‘time is money’ applies to the UK’s new DFYers (done for you-ers),” said Andy Gray, head of mortgages at Woolwich. “People think their own time is precious and with the added concern that they are not going to do a good job, people are increasingly turning to experts to get the job done.

“Home improvements can make a tangible difference to the value of peoples homes, but a bad standard of work can drag the price down.”

Some tasks are considered to be more worthy of hiring a professional than most, with 65 per cent saying that electrical work should be left to a qualified individual.

Plumbing is also avoided by 63 per cent, building an extension by 59 per cent and installing a new kitchen and bathroom by 58 per cent.

Interestingly, 35 per cent of people think that painting and decorating should be done by a professional, while 38 per cent think the same about erecting a shed.

Tags: professional, home improvements, difference, home insurance, added concern, andy gray, affair, time