Mortgage default levels could rise

According to a recent report the number of homeowners that are defaulting on their mortgage repayments in the UK is set to rise over the coming three months. The data comes from a survey that was carried out by the Bank of England amongst lenders and formed part of the central bank’s quarterly survey on credit conditions.

Over the past three months default levels amongst UK homeowners is said to have remained relatively flat. However, the figures showed that the balance of lenders who were expecting the rate of defaults on mortgage loans to increase rose to its highest level since the end of 2009.

The survey also showed that banks were not expecting to see any sharp increases in lending over the coming months, with the outlook for bad debts being cited as one of the reasons why banks may remain reluctant to lend in the immediate future. One economist said that the Bank of England report had nothing in it that suggested banks were likely to start lending more soon.

According to the data there has also been little in the way of change over the last three months when it comes to the availability of personal loans, mortgages and business loans. The data indicated that there could be an increase in unsecured lending to households over the next three months but that mortgage lending was likely to remain flat.

The report did indicate that there had been a marked improvement in the buy to let sector in the UK, with demand for buy to let having increased over the past few months. Lenders are expecting this improvements to continue over the coming few months and for the remainder of this year according to the report.

Tags: quarterly survey, bank, Federal Housing Administration, business loans, economist, United Kingdom, uk homeowners, improvements

UK Life insurance market very competitive

A spokesperson for Libra Financial Planning has announced that while “the life insurance market in this country is very competitive” and that prices are falling.

He said that premiums can vary greatly in terms, price and all the extra add-ons available, but the marketplace is still very competitive.

“I would say the market is quite strong,” he added.

The cost of life insurance appears to be falling due to people living longer say the organisation.

The impacts of medical improvements and healthier lifestyles are having a significant on our population and as a result people are living longer, said the spokesman.

Figures from the Financial Services Authority have revealed that by 2031 the life expectancy for men will be 81 years and for women, 85.

According to Prudential, the UK life insurance market was the largest in Europe and the third largest in the world in 2004, with approximately £105 billion of net premiums written.

Tags: life insurance market, europe, result, improvements, result people, United States, life expectancy, net premiums

Don’t DIY before checking your insurance

Brits are being advised to check their home insurance before undertaking home repairs or DIY projects.

New figures released today show that three quarters of a million people have inflicted £350 million of damage to their homes attempting to recreate improvements they have seen on home makeover TV shows.

While many household accidents – such as cracking a bath or smashing the glass in doors – are usually covered by standard buildings and contents policies, extensive remodelling can put DIY enthusiasts at risk of causing damage they are not covered for.

Damage such as drilling through pipes or falling through a ceiling are rarely covered in standard policies, according to Halifax Home Insurance.

“It all looks so simple on TV, making it easy to forget that the work on makeover shows is being carried out by highly trained and skilled professionals. But if you don’t know what you’re doing we’d advise anyone planning any major improvements that DIY should really stand for Don’t Involve Yourself,” said Vicky Emmott, Halifax Home Insurance.

“Indeed trying to tackle certain areas that you are not qualified for, such as electrics or plumbing could invalidate your home insurance and leave you liable for the cost of any subsequent damage. It’s far better to employ a reputable tradesman than to risk damaging your home by going it alone.”

Tags: Insurance, today, electrics, improvements, invalidate

Homeowners cautioned over the true cost of unsecured personal loans for home improvements

The latest figures released by the British Bankers’ Association (BBA) show that 198,242 mortgages, totaling £21.8 billion were approved in the UK in October, a six percent increase on September’s figures and an eight percent increase on the figures year-on-year.  At £144,200, the average UK residential property mortgage also saw a slight increase during the month.

Nonetheless, while, “the secured lending market undoubtedly remains robust,” according to David Dooks, director of statistics at the BBA, “after discount price growth, lending volumes are not dissimilar to the same time last year” – indicating that the recent base rates increases by the Bank of England mat be having some effect on the demand for UK property borrowing.  A factor echoed by Milan Khatri, chief economist at the Royal Institution of Chartered Surveyors, who foresees a slowdown in the UK property borrowing during the course of the next year once the full impact of those Bank of England rate increases filters through and the true higher cost of borrowing starts to be felt.

In the meantime,  a recent report by Money Expert is warning that an increasing number of UK homeowners are now opting to take-out unsecured personal loans to finance their home improvement projects over more cost effective ways of this type of borrowing. 

While this may, itself, not be too alarming, Money Expert’s findings also indicate that UK homeowners are not fully aware of how much their unsecured personal loan borrowing is costing them in extra interest payments.  In some cases, interest repayments on a four year £10,000 unsecured personal loan taken-out for home improvement projects can vary by as much as £2,500 – or 25%.

Sean Garden, chief executive of Money Expert, therefore warns, “Personal loans can vary in price dramatically – you could end up paying back as much as a quarter of the amount you borrowed in extra repayments unless you research the market carefully.”

As such, if you are one of the many new homeowners who have recently been approved a UK home mortgage loan and are now looking to undertaken some DIY home improvements on your new home, make sure you look around and research the many different types of UK unsecured personal loans available in the market to make sure that you get an unsecured loan that meets your needs without breaking the bank in extra interest payments.

Tags: home, improve, interest, cost, Mortgages, unsecured