Mortgage market could suffer over next quarter

Over the past couple of years things in the mortgage market have been tough, and availability of mortgages has become very restrained as a result of the global credit crisis and the recession. This has left many people unable to get their hands on a mortgage loan, and has had a serious impact on the property market.

The Bank of England has now issued a warning stating that there could be fresh restrictions in the mortgage market over the next few months, blaming the tightening of wholesale funding for the expected squeeze on mortgages. This will create additional difficulties for those that are looking to get a mortgage, and will reverse the recent trend of increased availability of mortgages.

The data comes from the Bank of England’s Credit Conditions Survey, and a number of economists have also agreed that the availability and affordability of mortgages could fall over the next few months as banks struggle with tightened wholesale funding.

Over the past quarter the availability of mortgages has actually increase after a couple of years of serious difficulties, but this is something that is set to go into reverse according to the Bank of England. Figures have also shown that over the past quarter demand for mortgages has fallen even though mortgage availability has been increasing.

Dougald Middleton, head of capital and debt advisory at Ernst and Young, said: “While the survey shows that costs of borrowing have eased over the last quarter, we think credit conditions have turned over the last three or four weeks.”

The good news from the Bank of England report was that the rate at which mortgage borrowers and businesses were defaulting on loan took an unexpected fall, which will come as good news for banks.

Tags: availability, Impact, mortgage, finance, demand

Repossession schemes will only help small numbers

In a recent report it has been claimed that initiatives launched to try and minimise on repossessions will only help a small number of people. Read more

Tags: Impact, personal finance, shadow, job, repossession scheme

Holidaymakers boycott Europe due to value of euro

As most people are aware the value of the pound against the euro has plummeted over the past couple of months, and for holidaymakers that normally head to place such as France or Spain for their holidays this has come as bad news. Recent reports have shown that holidaymakers from the UK are not prepared to be stung by the tumbling pound against the euro, and many have decided instead to head to pastures new rather than be left with little in the way of spending money by having to take out euros. Read more

Tags: industry official, Association, pound value, Impact, holidays, mexico cuba, office, non-Eurozone countries

How much will you need to retire?

For many people retirement is something that they would rather not think about, either because they do not have the money to put towards their retirement fund in the current financial climate where households are struggling to make ends meet due to higher bills and living costs, or because they are relatively young and feel that retirement is a long way off so they can think about it later. Read more

Tags: financial commitments, Retirement Report, Impact, post-career years, advisor, way, Financial economics, life trust

Brits want to live in Oz

Many people in Britain would like to get a mortgage on a property abroad as house prices and the cost of living in the UK continue to grow.

Research by Bank of Scotland International shows that of all the destinations available for Brits, Australia is the place most would like to live.

It seems that younger people are keener on the idea of Australia than their older counterparts, with 59 per cent of those who chose the country being under 45.

When asked which country in Europe they would most like to live in, the majority of Brits chose France with older people this time proving keener.

There was an even divide between the ages when it came to those who do want to own a property abroad and those who do not.

Around 44 per cent of those who do were under 45, while 39 per cent were aged between 45 and 64.

Tony Wilcox, managing director at Bank of Scotland International, said it is important for people considering moving abroad to do their research first.

“Living, working or retiring abroad can mean a whole set of lifestyle changes, including an impact upon your financial affairs,” he commented.

“Expatriates have different financial requirements and when moving abroad it is important to have the right products and services in place.”

Tags: different financial requirements, younger people, house, brits australia, bank of scotland international, brits chose france, Abraham Lincoln, Impact

Mortgage payments up 15%

Mortgage payments across England and Wales are increasing, leaving many homeowners in a precarious situation.

New figures, published by Woolwich Mortgages, shows that mortgage payments in April of this year reached £590.

That is an increase of £78 on the figure for the same month in 2006 and signals a rise in costs of 15 per cent.

Clearly this is going to have an effect on the financial situation of many homeowners and this is compounded by the fact that household net earnings have only increased by five per cent in the same time period.

Andy Gray, head of Woolwich Mortgages, is concerned that many people will be beginning to feel the pinch, especially if further interest rate rises are introduced.

“Mortgage borrowers are really getting squeezed. With the costs of council tax, petrol, food and drink, as well as mortgages, all increasing, consumers are seeing a large amount of their earnings being diverted to essentials, putting real pressure on disposable income,” he said.

“Most commentators are suggesting that interest rates will increase further this week. However, our research shows that that the three interest rate increases over the last 12 months are already starting to have a major impact on borrowers.”

The figures released for April put mortgage payments at the highest level they have been since Woolwich began collating the data in 2002.

Tags: Super jumbo mortgage, disposable income, interest rate, commentators, head, Impact

Newly-weds must update contents cover

Newly-married couples in Britain are being warned that they must ensure they have adequate cover for any wedding gifts they receive.

We are entering the traditional British wedding season and Churchill Home Insurance is concerned that many couples are not taking precautions.

One in ten married couples estimate that they received around £3,000 or more in gifts on their special day and this has a big impact on the value of their home contents.

However, many people do not take action and, should the worst happen, their home contents insurance does not cover the cost of the goods.

“Newlyweds should consider the insurance implications of receiving such a large number of valuable gifts and the impact this could have on the value of their home contents,” commented Frances Browning from Churchill Home Insurance.

“We urge all newly-married couples to check their home insurance policies to make sure they have adequate cover to suit their needs.”

Churchill calculates that the average wedding gift costs in the region of £60 which means that the total value of gifts can quickly add up.

The most popular wedding gift is money or vouchers, while traditional gifts such as kitchenware and electrical appliances also rank highly.

Make sure that you are adequately insured by regularly updating your contents insurance cover.

Tags: churchill home insurance, contents insurance, kitchenware, British people, newlyweds

Brits losing faith in property

Many Brits are losing their faith in the property market as a way of investing.

That is according to the Standard Life Savings & Investment Index which shows that continually rising interest rates are denting people’s confidence.

Since October 2006 confidence in our homes as a savings vehicle has fallen by 19 per cent and Standard Life says that this is down to recent interest rate rises.

In response to the findings, the firm is calling upon all of us to ensure that we do not invest all of our money into a property without sufficient financial backup.

“With interest rate rises having such an immediate impact on investor confidence, I hope that investors will now consider spreading their investments across a wider range of investment categories and vehicles when planning for their financial futures,” said Trevor Matthews, chief executive of Standard Life Assurance.

The index also revealed that over half (51 per cent) of us are saving for a holiday, while retirement, home improvements and buying a car followed.

Tags: investments, rising interest rates, Trevor Matthews, Impact, market, October, executive, savings

Insurers still have work to do

A new survey shows that most of us are pleased with the service we receive from insurers but many firms are still failing to deliver in specific areas.

The Association of British Insurers (ABI) asked thousands of people to take part in the Customer Impact survey and the results were generally positive.

However, despite the majority of customers (55 per cent) saying that they would be “extremely” or “very likely” to recommend their insurance firm to a friend, 20 per cent responded with a negative “not at all” or “not very likely”.

A massive 85 per cent of those questioned said that their company was easy to do business with, while 53 per cent were either “extremely” or “very satisfied” with the service they received.

Customers generally rated the insurance sales process as “very good” or “excellent”, with 58 per cent of people responding in this way.

Despite these positive figures, customers said that the thing most lacking in the sales process is clarity of information at the point of sale.

In addition, the complaints process was also highlighted as being in need of fine tuning, with four per cent of people having complained in the last 12 months and 50 per cent of these describing the handling of their complaint as “poor”.

“This year’s survey shows a strong position in several areas, and room for improvement in others,” said Stephen Sklaroff from ABI.

“Each company will review their own performance against the industry results, and where necessary take action to improve.”

Tags: sale.In addition, room, British Insurers, economics, percentage