Interest rates unlikely to increase this year

A recent poll has suggested that the base interest rate is unlikely to be increased over the course of this year, which is something that will bring relief to many homeowners and borrowers who are already struggling to make ends meet due to soaring costs and bills. The data comes from the latest Reuters poll of economists, which reveal that there is now only a 30 percent chance that the Monetary Policy Committee will increase the base rate from its current record low of just 0.5 percent where it has been for well over two years.

However, economists are predicting that there will be a base rate increase in the first quarter of next year although some believe that the next rate hike could be at least one year away, perhaps even longer. One industry official welcomed the news of the unlikelihood of a rate rise, stating that there were many households and individuals that would not be able to cope with a rate increase in the current climate due to overstretched finances, soaring living costs and rocketing bills.

He said: “Given that many people in the UK are currently struggling to make ends meet, an interest rate rise which will push up mortgage payments will cause a huge increase in families facing financial difficulty. The longer that interest rates are left unchanged the better from a personal debt point of view.”

The MPC has faced a difficult decision over recent months when it comes to increase interest rates, as members have been under pressure to vote for an increase due to soaring inflation levels but have also been under pressure to keep the rate on hold because of the concerns about the economy and affordability.

Tags: reuters poll, course, committee, uk, mortgage

Vehicle insurance related costs soar

It has been revealed in a recent report that costs relating to insuring cars and other vehicles have soared in the UK over recent months, resulting in many drivers who may already be struggling financially due to the cost of living and petrol prices finding it even more difficult to keep their vehicles on the road.

According to the report the costs associated with insuring a car or vehicle in the UK have increased by more than 14 percent in the second quarter of this year. The figures have come from the EMB Car Insurance Price Index and the online insurance comparison site Confused.

The rise in costs associated with insuring a car are much higher than the increases that were seen in the final quarter of last year and the first quarter of this year. In the last three months of 2009 costs relating to insuring a car increased by 4.3 percent, and in the first three months of this year the costs relating to insuring a car increased by 6.3 percent.

The massive increase in costs of over 14 percent seen in the second quarter of this year has resulted in around £74 being added to the average cost of car insurance for drivers. This reflects a total increase of 31 percent according to figures, and brings the average annual cost of car insurance to £599.

Some areas saw costs relating to car insurance rise more than others, and amongst those to be hardest hit were inner London and Manchester. Insurance officials have also said that this is not the end of the bad news for drivers, as many believe that the cost of vehicle insurance could continue to increase, which would mean even higher premiums for many cash strapped drivers.

Tags: second quarter, end, Vehicle insurance, premiums, United Kingdom, quarter, car insurance, Insurance

Grandparents struggle so they can help the grandkids

It has been reported that millions of grandparents in the UK are prepared to struggle financially so that they can use their money to provide for their grandchildren. Read more

Tags: family, quarter, spoilt, retirement, official

Banks urged to provide services to those that are excluded

A group consisting of charities and local groups is urging banks to extend their services to those that are currently excluded from a wide range of banking services, such as current accounts, basic bank accounts, credit cards, loans, and overdrafts. Read more

Tags: bank accounts, overdraft, Credit Cards, interest rates, quarter

CML revises repossession forecasts again

It has been reported that the Council of Mortgage Lenders has once again cut its forecasts for repossession numbers in the UK, having taken more recent industry figures and market conditions into consideration. Read more

Tags: repossessions, CML revises repossession, quarter, cml, time, Mortgages, Business Finance, council of mortgage lenders

25% of the nation could face fuel poverty

Energy prices have been at the centre of heated controversy over the course of this year. At the start of the year the big energy firms in the UK cheerfully announced that because the price of wholesale energy had risen the cost of energy usage for customers would be going up, and just weeks later, true to their word, they increased energy usage costs quite significantly, leaving already struggling household to cope with more financial worry and strain. Read more

Tags: quarter, fuel, GBP, situation, report, money

Savings accounts suffering due to high inflation

Soaring inflation levels, high food prices, rocketing energy bills, high petrol costs, and increased borrowing costs have been impacting on household finances in the UK for some months now, and a recent report has shown that many people are now having to raid their savings in order to try and keep afloat financially. Officials have stated that with the economy heading downwards and inflation spiralling upwards Brits are left with little choice but to raid their savings. Read more

Tags: doom and gloom, Brits, savings accounts, savings, quarter

Equifax: Be ‘cautious’ about ID fraud

Consumers should be more wary of people trying to steal their identity details, an expert at Equifax has advised.

Neil Munroe, external affairs director at Equifax, said that an individual’s personal credit profile could be worth “several times more” than their maximum limit on their credit card.

According to CIFAS, the total number of fraud cases the organisation received by the end of the first quarter of 2008 was 52,286, which represented an increase of ten per cent compared with the same period in 2007.

The number of occurrences which involved a fraudster impersonating someone in order to takeover their bank account were up by 146 per cent.

Mr Monroe commented that the authorities should also make an effort to combat the issue: “There is a list of precautions that individuals should take but it’s not just an individual’s fight, it is a combined fight and the government need to be doing more around it and so do companies.”

Tags: quarter, Financial services, authorities, first quarter, Cifas, credit, list, end

Up to £1.6bn to be spent on Valentines day

British spenders are expected to splash out up to £1.6 billion on Valentines day gifts for loved ones, according to a recent survey.

Findings from PayPal revealed that the average spend per gift is thought to be £71.25 with those in a relationship spending £69.90.

Cristina Hoole, spokeswoman for PayPal, said: “It would seem that romance is far from dead as almost half of Brits will be splashing out a massive £1.6 billion on their loved ones this week.”

She added that as millions are expected to hit shops, up to one in five will choose to shop online for a gift to avoid the crowds.

Further findings from PayPal showed that up to a quarter of UK men are more likely to conduct their shopping online and 36 per cent of Brits in a relationship do not plan to give any presents.

Meanwhile, research from APACS, the UK’s payment association, revealed that credit card spending over the festive period totalled £32.2 billion.

Tags: UK men, facebook, recent survey, quarter, relationship, card, romance, day

A quarter of a billion pounds left in accounts says investment provider

A new initiative has been launched to reunite consumers with their lost bank accounts after it was announced that an estimated quarter of a billion pounds has been forgotten.

National Savings and Investments said that the main reason for money being left in accounts is moving house.

Ayesha De Silva, online manager for NS&I, said: “People often hold an account with two or three different providers over the course of a lifetime and when they move house, it’s the simple fact they forget to tell all the relevant people.”

She added that this situation is exacerbated by every move that a person makes meaning that the funds can just “sits there for years and years and years”.

In research carried out by TNS Phonebus last year, national statistics show that ten per cent of people believe they have lost savings they had as a child.

Only 26 per cent of these people have tried to reunite themselves with their lost money.

Tags: bank accounts, cent, house, quarter, fact, inflation, National Savings, lost bank

Homeowners ‘do not have adequate insurance’

Up to one in five of Brits have no home insurance while a quarter do not know what their policy covers, according to a recent poll.

Findings from the Nationwide showed that many respondents are at the risk of being underinsured with 14 per cent of people admit to not have any contents insurance.

This is despite the average homeowner having home contents worth between £14,000 and £21,000.

Nationwide’s insurance director, Robin Bailey, said: “It is surprising that so many people are prepared to take such a gamble on their homes and personal belongings when you consider how much time and money we all invest in our homes.

He added that as consumers never know “what is round the corner”, they would benefit from being prepared by having adequate insurance.

However, the survey also showed that those aged 45 and over are more likely to have both buildings and contents insurance and claim to possess full knowledge of what is covered.

Meanwhile increasing numbers of homes are at risk from dangerous weather, Abbey Home Insurance has stated.

Tags: covered.Meanwhile increasing numbers, quarter, Windloss Inspection, Insurance, Brits

Insurance industry commits to pay out more

The insurance industry’s commitment to pay out more on claims for critical illness, income protection and life insurance has been welcomed by industry experts.

Previously clients, insurers and medical practitioners were sometimes “unsure of what position to take” when dealing with a claim where medical information had not been disclosed unless the customer has deliberately withheld it.

Graeme Trudgill, technical and corporate affairs executive of British Insurance Brokers’ Association, said: “The Association of British Insurers (ABI) are trying to make the situation a bit more black and white to help customers do the right thing and to pay the claim.”

He added that some claims have not been accepted for “various reasons” and critical illness has had a “bad time” in the press.

The ABI changes are hoped to make the process of making a claim more consumer friendly.

According to LifeSearch, one in five critical illness claims are rejected.

However, according to its research carried out in the fourth quarter of 2007, there has been a marked improvement in the number of claims being paid out in the last 12 to 18 months.

Tags: insurance brokers association, economics, industry, corporate affairs executive, black, consumer, quarter, lifesearch

Buy-to-let sector remains upbeat

The optimism in the buy-to-let sector has not been deterred by predictions of a moderating property market, according to industry experts.

Research from the Association of Residential Letting Agents (ARLA) has revealed that only one in ten of landlords are considering selling their property.

A further 40 per cent of investors are looking to expand their property portfolios over the next year.

Ian Potter, head of operations at ARLA, said: “This is good news for the whole of the private rented sector and for the housing market, particularly as it comes from surveys carried out well after the credit crunch had begun to bite.”

The findings also show that 90 per cent of buy-to-let landlords also have no intention of selling up in the last quarter of 2007 within the next 17 years.

Meanwhile, house prices in the UK increased by just one per cent in the final quarter of 2007, according to research released today by the Nationwide building society.

Tags: investors, research, credit crunch, quarter, today, last quarter, nationwide, 17 years

‘Human nature’ for people to forget about money’

Many people routinely forget about old bank accounts or financial transactions, according to the Unclaimed Assets Register (UAR).

There is approximately £15.3 billion in the UK in unclaimed assets, according to the organisation.

Forgetting about old bank accounts, especially in the world of online banking, is “human nature”, said Paul Brine, a spokesperson for the UAR.

Ms Brine said: “There’s times in our lives when we’re more interested in our investments where they’re long term. If I leant you a fiver, I’d be interested in getting that back tomorrow.

“If I invested £200 in some shareholdings, I might be interested in them in two or three years time, to see how they’ve done … Your degrees of interest change.”

Currently, the number of people who have visited the British Bankers’ Association’s dormant account search page is approaching a quarter of a million.

Tags: online banking, Arab nationalism, Human, quarter, UAR, back tomorrow, leant

DIYers hope to add £5k to property value

More and more of us are carrying out home improvements, with the majority doing so to increase the value of our property.

New research by Halifax shows that people with a mortgage are becoming more active when it comes to DIY and over a quarter of us believe that the work we have carried out in the past 12 months will add £5,000 to the price of our homes.

Home improvements have increased in popularity in the last year, with 58 per cent of homeowners having carried out some work – 12 per cent higher than the previous year.

In addition, young homeowners are doing more work, with redecorating still the most popular improvement in the country.

Gardens have become the second most popular area to focus our DIY skills on, with 41 per cent of mortgage-holders doing some kind of work in the yard.

The kitchen is the area most people would like to change in their home, however, the work does not often get done with finances and lack of know-how being touted as the most common restricting factors.

The cost of home improvements can be stifling and many people are forced to take out a loan in order to be able to afford the work.

Halifax found that 11 per cent of homeowners have spent over £10,000 on improving their property in the last 12 months.

A further 33 per cent spent between £2,500 and £10,000, while 51 per cent forked out anything up to £2,500.

Homeowners are encouraged to ensure that they can realistically afford any home improvements that they may be planning before starting the work.

Tags: homes.Home improvements, home improvements, country, Mortgages, quarter, year

2006 credit card borrowing down

Credit card borrowing fell in December 2006, according to updated figures released by the British Bankers’ Association (BBA).

Following the release of figures from the Major British Banking Groups earlier this month, BBA has gathered more information,

This new data shows that credit card borrowing fell by £0.3 billion in December, with the overall annual figure rising by just two per cent.

“The annual growth in consumer credit, at only two per cent, is low by historical comparison and, although strong Christmas sales have been reported, our December figures suggest that spending was not fuelled by more borrowing on credit cards,” said David Dooks from BBA.

Mortgage lending in December fell in comparison to November, but even this figure was a seven per cent increase on the same month in 2005.

In total, mortgage lending reached £18.1 billion, with 123,518 mortgages being approved.

The average amount lent for the purpose of buying a home soared in comparison to December 2005, with the average amount being £146,400, nine per cent more than the year before.

“The final quarter of last year, despite seasonally lower activity in December, showed the mortgage market to be stronger than at the same time a year earlier and lending still growing significantly at a time of rising interest rates,” added Mr Dooks.

Tags: information, consumer credit, interest, activity, british bankers association, increase, Association

House prices rise by 9.9%

House prices in the UK rose by 9.9 per cent throughout 2006, according to the Halifax bank.

A report carried out by the bank shows that price inflation on properties in the country increased during the last 12 months.

Despite the overall rise, Halifax said that prices fell by one per cent in December, with some industry figures hopeful of a slowing down in the market.

“It remains too early to conclude that this indicates a genuine slowdown in the housing market,” said Halifax’s chief economist Martin Ellis.

“Overall, prices in the final quarter of 2006 were 4.2 per cent higher than in the previous quarter, marking the strongest quarterly rise since 2004 quarter two.”

Northern Ireland saw the biggest increases during 2006, with the average house price rising by 53 per cent.

Halifax’s report is based on figures from its own lending to customers but falls in line with other major lenders’ results.

Nationwide recently published a report into 2006 house prices and put the rate of inflation at 10.5 per cent.

Although Halifax says factors such as economic growth, rising employment and lack of supply will drive up house prices, the bank expects to see a slowdown in the coming year.

“Higher interest rates, greater pressure on household finances and subdued real earnings growth will… constrain housing demand,” said Mr Ellis. “We expect house prices to increase by four per cent in 2007.”

Tags: quarter, price, average house price, chief economist, Halifax bank.A report