Christmas borrowers: have a plan for payback

With Christmas nearly upon us, keeping the costs down to a reasonable level is an important part of enjoying the festive season in a way that won’t lead to worry and anxiety in the New Year. If anyone’s plan involves borrowing to meet the costs of Christmas, it’s important they first figure out a realistic repayment plan.

So says Think Money, which has issued a warning for people who are thinking of borrowing to help them meet the costs of Christmas.

It advises them to plan their finances out carefully before they actually borrow any more. Without a good repayment plan in place, they’re running the risk that they won’t be able to repay it as quickly as planned (or, potentially, at all).

As you might expect, this could lead to all kinds of problems, from higher-than-expected interest costs to late payment charges. Depending on the individual’s situation, it could even lead to more serious consequences, such as a CCJ (County Court Judgment).

“[…] some people might be making a New Year’s resolution to get their finances in order,” a spokesperson for the financial services company commented.

“For some, that might involve taking out a debt consolidation loan to simplify their finances and set out a clear plan for repaying their debts. This can be a good way of managing debt, but borrowers still need to make sure their repayments fit in with the rest of their budget.”

Tags: year, Christmas borrowers, repayment, anxiety, court

More compensation payouts to be issued by Halifax

High Street banking giant, Halifax, has recently admitted that it may have to pay out more compensation to customers over a mix up with its mortgage rates. Earlier this year the lender identified around 600,000 customers who may be eligible for compensation over confusion about mortgage rates, about half of whom ended up receiving compensation payouts. The lender has now stated that there could be another 250,000 people who may be eligible with around half of them expected to actually receive compensation.

The compensation that the lender pays out could be up to £4500 per person based on a mortgage of £150,000 where the borrower has been affected for three years. The payouts will equate to either 1 percent of the mortgage interest for each year that the borrower has been affected or will be a fixed compensation payout. With tens of thousands of borrowers potentially set to receive compensation, Halifax could have another huge bill on its hands.

The confusion has arisen over Halifax increased the cap on its standard variable rate mortgages from 2 percent above the Bank of England base rate to 3 percent above. The UK’s financial regulator, the Financial Services Authority, expressed concern that wording on documentation may have led borrowers to believe that they would receive advance warning of any such changes. Halifax subsequently came to an agreement with the FSA over paying compensation to customers who were affected.

A Halifax official said: “In February 2011, we agreed a voluntary agreement with the FSA in relation to a customer contact and goodwill payment programme with specific Halifax mortgage customers. We have subsequently identified a further group of customers that are eligible for inclusion within the programme. We are now in the process of writing to these borrowers explaining what this means for them.”

Tags: uk, Mortgages, year, Mortgage loan, payout, standard, compensation payouts

Lack of consumer confidence continues with High Street banking giants

For the last few years the leading High Street banks in the UK have taken a real battering in terms of consumer satisfaction and confidence levels, with many people losing faith in the biggest banks, including those that have had to be bailed out by taxpayers. A recent survey has shown that lack of confidence and satisfaction with the big High street banks continues, despite their general market dominance.

The survey was carried out by the consumer campaign group, Which?. As part of the process twenty eight banks and building societies were analysed in terms of their customer satisfaction levels. All main services were looked at when assessing customer satisfaction levels, including current accounts, savings accounts, credit cards and mortgages. This comes after it was revealed that in the first half of this year the Financial Ombudsman Service received around 54 percent more complaints about financial institutions compared to the final half of last year.

When it came to customer satisfaction levels amongst financial institutions none of the leading High Street banks even managed to make the top fifteen. In fact, the results showed that the four banks that had the highest levels of customer satisfaction when it came to current accounts controlled only 6 percent of the current account market whereas the four banks that had the lowest levels of customer satisfaction with current accounts controlled 38 percent of the current account market.

An official from Which? said: “The high street is dominated by banks that have a shocking record for customer satisfaction – what more proof do we need that the market isn’t working? We will only have a truly competitive market when banks are made to face up to a simple choice – either look after your customers or be prepared to lose them.”

Tags: none, general market dominance, satisfaction, Current account, shocking record, year, consumer satisfaction

Motor insurance continues to rise

A recent survey has shown that motor insurance is continuing to increase, leaving many drivers who are already struggling to keep up with the cost of running their vehicle in an even worse situation in terms of their finances. The cost of vehicle insurance has been soaring recently and is much higher now than it was a year ago. On top of this drivers have had to deal with vast increases in petrol costs, leaving many financially crippled.

According to the results of the survey the cost of insuring a vehicle is now nearly 31 percent higher than it was a year ago. Compared to March the cost of vehicle insurance cover in April increased by 4 percent, showing that car insurance costs are continuing to increase. Many drivers are now being forced to abandon their vehicles and look at other modes of transport because of the high costs involved with running their vehicle.

An official from one insurance monitoring group, Tiger.co.uk, said: “Our analysis shows that car insurance inflation continues to be a major financial issue for the majority of UK drivers. Within our analysis inflation in the last month has been particularly prevalent for younger female drivers and we may well be seeing here the early impact of the recent EU gender ruling that, from December 2012, will outlaw the use as gender as an insurance risk factor in its own right.”

For the many people who are already struggling experts are advising considering a switch in insurance, as the cost of cover can vary from one provider to another. Drivers can compare the cost and levels of cover with ease using the Internet and can look at finding a more appropriate level of cover at a more affordable price.

Tags: The cost, vast increases, Many drivers, year, risk factor, factor, group, Business and Economy

Interest rate increases will mean paying out more on debt

Industry officials have said that increases in interest rates over the next four years will result in families having to find more money every year to make increased payments on debt such as credit cards, loans, and other forms of finance that are based on variable rates. This could result in families having to find a whopping £1800 a year more in order to deal with the increased interest on these debts.

For nearly two years now the base interest rate has been at an all time low of just 0.5 percent, and this is he lowest it has been in the history of the Bank of England, which spans over three centuries. However, inflation levels are now soaring and many industry officials now believe that the rate of interest will have to rise over the course of this year in order to keep a lid on inflation, which could mean more financial hardship for many households.

There are a number of experts that think the rate rises could start by this summer, which means that households would have to cope with additional interest on their debts as well as higher living costs and increased VAT, which went up by 2.5 percent at the start of this year. Mortgage payers will also be affected with extra payments, which could leave many on the financial edge and put them at risk of missed repayments.

The Bank of England said: “Currently, around two thirds of outstanding mortgages in the United Kingdom have floating interest rates, somewhat above the average over the past five years. That proportion is rising as mortgagors move on to standard variable rate products as existing fixed-rate deals expire. This exposes more households to the risk of increases in interest rates.”

Tags: Loans, year, variable rate products, households, lid, United Kingdom, GBP, interest rates

Competition increases in personal loans market

The start of this year has marked a change in the personal loans market that has seen a variety of well known lenders reducing the rates on some of their personal loans, and this has resulted in the average rate of interest being charged on loans of between £7500 and £15000 falling to their lowest level since November 2008.

Many consumers who have been considering a loan will welcome the news, as it means that they will pay far less for their borrowing as lenders compete with one another to offer the best deals and entice consumers away from their competitors. High Street banking giant Santander is offering a personal loan between these amounts at just 7.3 percent, and others are also offering similar rates.

However, those that are after a loan of £5000 or less will find themselves paying far more in the way of interest, as the rate of interest on smaller loans has actually increased during this period. Sainsbury’s, Tesco, and M&S Money are amongst the other lenders that have decided to reduce their interest rates on larger loans, but some are only offering the most competitive deals to existing customers rather than both existing and new customers, which may cause some disappointment amongst both consumers and industry officials.

A financial expert stated: ‘It’s welcome news for customers to see loan rates falling at long last and from some of the largest providers in the market. It’s a shame that the rate cutting has, apart from Tesco and M&S Money, been targeted at existing customers only. The other downside is that lower interest rates are not on offer for smaller borrowings, so for anyone looking to borrow a sum of say £2,000 to £3,000, the interest rate will be well into double figures and in some cases pushing 20% APR.’

Tags: loan rates, apr, money, customer, expert, new customers, year, downside

Doorstep lenders can cause huge problems for consumers

It has been claimed in a recent report that doorstep lenders in the UK often cause huge problems for consumers because the loans that they offer can put borrowers in a cycle of debt that is difficult to escape. The OFT is now on a mission to try and protect vulnerable consumers from getting into financial hot water with these doorstep loans by making lenders prove that they are adhering to the Consumer Credit Act.

 

In the past eighteen months over 100 applications for licenses from doorstep lenders have been turned down by the Office of Fair Trading, and according to reports the watchdog has now written to around half of these companies asking for proof that they are adhering to the regulations and rules of the Consumer Credit Act. Companies have three months to provide this information.

 

Some doorstep lenders have been accused of misleading customers by failing to provide details about things such as their right to cancel, which makes some borrowers think that they are stuck in the credit agreement when in fact they are still within the time period where they can cancel. Others were accused of turning up at people’s houses without any prior notification or arrangement.

 

The crippling rates of interest charged by doorstep lenders have also been highlighted as a problem, and whilst the loans are only meant to be short term ones the APR that is charged by these lenders can be extortionate. This can quickly lead to already vulnerable consumers falling into even more severe problems with their finances. The OFT said that at this time of year in particular, with many people desperate for money to spend on Christmas purchases, tackling this issue was a priority in order to help people to avoid further debt problems and issues.

Tags: uk, credit agreement, year, recent report, doorstep lenders, severe problems, notification, mission

Airlines dragging their feet over ash cloud insurance payout

The Icelandic volcanic ash cloud that swept across UK airspace earlier this year caused havoc for many travellers, leaving many stranded abroad and many others unable to set off on their travels. UK airspace had to be closed towards the end of April this year for around a week, and many people that were stranded abroad had to pay for food, accommodation, and to contact people at home.

Thousands of travellers had to put in claims as a result of the chaos and the money that they had to pay out to stay abroad until UK airspace was opened again. However, it has emerged that eight months later many are still waiting for their claims to be sorted out, with some airlines dragging their feet over payment on claims.

A number of unscrupulous practices are said to be going on amongst some airlines, which includes capping payouts to consumers, only paying a fraction of the amount being claimed by consumers, delaying claims until early next year or beyond in some cases, making consumers contact foreign compensation schemes and pay for translators, failing to respond to emails forcing consumers to contact them via expensive phone numbers.

Industry official have expressed concern that many consumers with travel insurance who were trying to claim for the disaster are being directed to foreign complaints bodies that do not provide translation services.

One official said: ‘This has meant travellers have had to pay for translators to get their complaint put in to the local language. They would not have to do this if the airlines just met their obligations. For example, they cannot limit claims, and we have seen that happening. We are in constant discussions with the airlines about their responsibilities.’

Tags: food, contact, phone numbers, compensation schemes, Financial services, Volcanic ash, translation services

Bank of England base rate needs to be increased

A member of the powerful Monetary Policy Committee has recently stated that it is essential that the base interest rate is increased in order to keep a lid on spiralling inflation, which could otherwise damage the economy. Andrew Sentance has voted to increase the rate for the past several months, but with the majority of members voting to keep the rate on hold the base rate has remained at its rock bottom level of 0.5 percent for the past nineteen months.

Sentance has said that the base rate should be increased gradually in order to try and curb inflation levels, which are currently way over the 2 percent target set by the government. Sentance was making a speech in London when he expressed his views, and minutes of Bank of England meetings show that he has voted for increases in the base rate for the past few months.

Between June and September Sentance was the only member of the Monetary Policy Committee that voted for an increase, but with all others voting to keep rates on hold the base rate remained static. Its current level is the lowest in the history of the Bank of England, which spans over three hundred years, and it was reduced to this level under the former Labour government amidst hopes that it would help to aid the failing economy during the global financial crisis and the recession.

In his speech Sentance stated: “I have voted for a rise in interest rates at recent MPC meetings — as a start to a gradual movement away from the exceptional level of monetary stimulus put in place to combat very difficult economic conditions last year. And I continue to believe that this is the right policy for the situation the UK economy currently faces.”

Tags: Monetary Policy Committee, Monetary policy, year, bottom level, Andrew Sentance, hundred years, london, interest rates

Net lending to businesses falls further

Recently released figures have suggested that net bank lending to businesses in the UK continued to fall in the month of May despite the fact that the recession is now over and the economy is meant to be getting back on its feet. Since the onset of the global credit crisis there has been a lot of concern over lack of lending by banks to businesses in the UK, and this is something that many thought would result in the recession being more prolonged than it otherwise may have been.

The recent figures were released by the Bank of England, and showed that net bank lending in the month of May from banks to businesses had fallen. However, it was also noted that the rate at which banks were writing off bad loans had fallen. The central bank also noted that the demand for borrowing by smaller and medium sized businesses remained subdued, which may have contributed to the falling figures.

According to figures net bank lending to businesses has been falling on a month by month basis since December of 2008, although there was a slight respite in November of last year, when net lending by banks to businesses saw a modest increase. There are concerns over the amount that lenders are now having to pay to borrow themselves, and it is thought that these costs could end up being passed on to corporate customers.

The data came from the recent Trends in Lending report from the central banks, and report noted: “The intensification of market concerns over fiscal sustainability in a number of countries at the start of May resulted in heightened volatility and a reduction of liquidity in funding markets.”

Tags: corporate customers, Banking Services, bank, england, finance

Thousands get extension to complain about PPI

It has been reported that tens of thousands of consumers who may be looking to make a complaint about PPI, or Payment Protection Insurance, have been given an extension to the deadline to make their complaint by the UK’s financial regulator, the Financial Services Authority.

The normal deadline for PPI complaints in relation to being mis-sold the cover is six months. However, the FSA has extended the deadline for five months for those whose complaints were rejected by firms between November 28^th last year April 28^th this year. It is thought that around fifty five thousand people could benefit from the extension.

The additional five month period that has been granted by the FSA means that the tens of thousands of people whose complaints were turned down between November last year and April this year now have until towards the end of October this year to complain.

There was a delay in the FSA’s own plans whilst it decided how companies should be made to deal with PPI complaints. However, the regulator did not want consumers to suffer as a result of the delays, and this is why it has decided that it should extend the complaint deadline.

PPI has been at the centre of controversy for some time, and there have been investigations carried out showing that many people were mis-sold these policies, which were often sold to those that did not want them or were under the impression that they had to have the insurance cover in order to get the finance that they wanted.

One consumer said: “I’m glad that the FSA decided to extend the deadline, as otherwise I would have missed out on my chance to complain and possibly get a refund on cover that I believe to have been mis-sold to me.”

Tags: year, mortgage, investigations, ppi, finance, delay

Water bills to soar over the next two decades

One of the UK’s biggest water suppliers, Severn Trent, has said that water bills are likely to soar over the next two decades. The water supplier predicts that over the next twenty years the cost of water bills will soar around 27 percent above inflation.

The supplier has put the increase down to rising operating costs and EU regulations, both of which it claims will cost the industry billions of pounds. The water industry was privatised in 1989, and since that time has made huge profits from increasing bills. However, despite the price increases water companies are said to have failed to carry out repairs and offered a poor level of customer service.

Severn Trent said that rules that have now been brought in by regulators will results in billions of pounds having to be spent over the coming years, and these operating costs are going to prove hard to handle by the water suppliers. The company said that the rising costs that would be incurred by the water industry would have to be passed on to customers, who would see their water bills rocket as a result.

An official from Severn Trent stated: ‘It is not clear such a continued high level of investment is sustainable in terms of whether it can be financed, whether customers are willing to pay for it and the detrimental impact on carbon emissions.’

The water regulator Ofwat has also ordered water suppliers to place a cap on bills over the next five year, with Severn Trent being told to cut its bills by 4 percent, which will also hit the supplier hard. The rising cost of borrowing, which is a problem for all businesses, is also going to play a part in the higher costs that customers will face.

Tags: bills, business, costs, Severn Trent, water bills, water, year

More people putting money towards funerals instead of savings

According to a recent report an increasing number of consumers are now putting money towards their funeral costs rather than putting it into savings. It appears that the recession has caused a new trend to emerge, and rather than leaving their loved ones to foot the bill should the worst happen many people are already putting money aside for their funeral rather than putting their spare money into a savings account. Read more

Tags: year, space, increase, london, savings, report

No luck over challenge for UK retirement age

It has recently been announced that a law that enables employers in the UK to make employees retire at the age of sixty five is to be upheld, at least for the near future. The decision was made by the High Court, and means that workers in the UK may be forced to retire at that age whether they want to or not, and without any sort of payout from the company. Read more

Tags: retirement, finance, Superannuation in Australia, uk, year, court

American Express encourages customers to spend more on cards

One major credit card provider has been encouraging its customers to spend more on their credit cards, according to a recent report. Despite the fact that there is a personal debt crisis in the UK card provider and financial giant American Express is said to be encouraging some of its platinum credit card holders to spend more than double their current spending by making changes to how they will qualify to claim cash back on their credit cards. Read more

Tags: back scheme, Debit card, giant american express, american express, fact, american express credit cards, addition, year

Credit card rates will have to come down

In a recent report a leading consumer watchdog groups has said that credit card interest rates in the UK are going to have to come down. Read more

Tags: Credit Cards, choice, increase credit card rate, credit card rate, higher rates, interest rates, year, company

Guide developed to help cardholders use cards effectively abroad

A new guide has been developed to help consumers learn more about using their credit cards abroad more effectively and sensibly. Read more

Tags: The new guide, new guide, year, credit card fraud, apacs, fraud, credit cards abroad, Credit Cards

Negative retails figures announced for May

Recent figures that were released with regards to retail spending have shown that whilst there were some encouraging signs of increased spending shown over the Easter period retail gains have slipped back down again for May. Read more

Tags: year, consumer spending, recession, confederation of british industries, retailers

Some savings accounts increase interest rates

Some savers in the UK are set to benefit from increased interest rates on their savings, with a number of financial institutions increasing the rates that they will pay savers even though the base interest rate has remained static at 0.5 percent, which is its lowest level in the three hundred and fifteen year history of the Bank of England. Read more

Tags: year, uk, high, good news, savings accounts, cash

Rising number of Brits could head to New Zealand

Whilst many Brits may have jetted off to New Zealand for a long vacation to enjoy the beauty, natural surroundings, and sights, it has been revealed that many have made their minds up to go there and not bother coming back. Read more

Tags: unemployment, super tax, new zealand, traditional occupations, year

First time buyers still having to put up with renting

For many years many non-homeowners that simply couldn’t afford to buy a home due to ten years of rocketing property values have been waiting in the wings for property prices to start coming down again, over in the latter part of 2007 many were delighted to find that this was indeed happening at last. Read more

Tags: first time buyers, Mortgages, large number, year, housing market, Mortgage loan, first time buyer, bank of england

Many will never be free from debt claims CAB

Officials from the charity the Citizen’s Advice Bureau have recently claimed that the typical person that is seeking assistance with their finances and debts has no chance of actually ever getting out of debt during their lifetime, which is a daunting prospect for the many people that have found themselves burdened with high levels of debt. Read more

Tags: finance, chance, debt consolidation, year, personal debt, debt help, Debt Relief Order, development

Appeals Court throws out bank charges appeal

Since the start of 2008 the High Court has been dealing with a battle between the Office of Fair Trading and the UK’s banking industry over the controversial issue of bank charges for unauthorised overdraft use, returned direct debits, and bounced cheques. Read more

Tags: decision, Bank charge, Appellate court, appeals court, year

Lower interest rates sparks interest in property market

According to a recent report the dramatic drop in interest rates that has taken place over recent months has resulted in renewed interest in the housing market from would be buyers. Read more

Tags: housing market, margins, property market, year, low interest rates, time buyers, rates, Royal Institute of Chartered Surveyors

How safe is your job?

Many of us thought that 2008 was a rocky year, but there is a lot of evidence pointing to the fact that this year could be even more turbulent, not least because of the number of jobs losses that are expected. Read more

Tags: unemployment, job losses, year, property sales, Economic history, global credit crunch, number, official

Tesco lost out to supermarket giants over Christmas

One of the leading supermarkets in the UK has admitted that over the Christmas period it lost out to its rival supermarket giants, with the weakest sales growth in nearly two decades. In the run up to Christmas sales levels for Tesco only went up by around 2.5 percent, which was far less than its rival supermarkets. Read more

Tags: supermarkets, British Retail Consortium, interest, price, sales figures, tesco, year

RBS will take action over refunding bank charges

High Street bank Royal Bank of Scotland has reportedly decided that in the event that the ongoing High Court case in to bank charges is lost by the banks it will be pro-active in ensuring that all customers receive a refund on their bank charges that were applied for exceeding the credit limit on the account. The banks, along with seven others, is currently appealing against a ruling made by the courts earlier this year, when it ruled in favour of the Office of Fair Trading. Read more

Tags: bank, finance, bank charge refunds, high street bank, bank charges, year

January sales start early on the High Street

With Christmas well on its way and consumer spending levels still low due to tight financial conditions, many major retailers on the High Street have started their January sales early by slashing the prices of their goods in the hope that it will boost spending amongst consumers. Retailers are slashing prices by up to 75 percent in some cases, hoping that their bargain prices will pull in customers and reduce the risk of shattered profits over what is expected to be a bleak Christmas in terms of spending. Read more

Tags: retail, sales, research, festive season, industry, risk, recession, year

High street to suffer as consumers try and save money

Although Christmas is just around the corner many High Street retailers are not getting too excited about the flurry of activity and more importantly the huge profits that will come rolling in, namely because this is something that is unlikely to happen this year. After a particularly gruelling year in terms of finances, with soaring living costs, rocketing bills, and sky high borrowing costs to deal with, many consumers are desperate to try and put some money aside, and to do this many will have to cut back on the cost of Christmas, and reduce the amount of money that they spend on presents, food, going out, clothes, and entertainment. Read more

Tags: run, name, bank of england, food, year

Northern Rock forced to cut savings accounts

Just a year ago Northern Rock was being branded the victim of the first run on a British bank in almost 150 years, and customers were flocking to get to the bank and take out their cash amidst rumours that the bank was on the verge of collapse. However, since this time the bank has been nationalised and since falling into government hands now offers a 100% guarantee on savings deposits for customers – a guarantee that had previously only been available on National Savings & Investments. Read more

Tags: rush, hbos, lloyds tsb, northern rock, competition, year

Personal data breaches – are they getting worse?

Over the past year or two consumer confidence when it comes to the safety of personal data has seriously waned, and this comes as no surprise given the number of serious personal data breaches that have come to light in the last year alone. Everything ranging from banks throwing customer account details into skips and bags outside or sending people’s account details to other customers from HM Revenue and Customs losing the bank details of twenty five million people has come to light over the past year. Read more

Tags: crime, Mr Chapman, data breaches, little wonder, banking details, Technology Internet

Water firms receive record numbers of complaints

According to a recent report water firms have been receiving record numbers of complaints over the past twelve months. The data comes from the water watchdog, the Consumer Council for Water. Read more

Tags: United Kingdom, individual water companies, complaints regarding water, customer, South West Water, year, water firms

Memo indicated that banks told that bank charges are probably unfair

This year’s High Court test case into bank charges saw round one go to the Office of Fair Trading, with the regulatory body being given permission to assess banks# terms and conditions, including overdraft charges, for fairness. According to the contents of a leaked memo that was sent to senior staff members at RBS and Natwest the OFT has concluded that the charges applied by the UK’s leading banks are indeed unfair. Read more

Tags: August, test case, bank charges, year, rbs, bill

Split decision on rates at last MPC meeting

According to the recently released minutes from the last Monetary Policy Committee meeting held in early August there was a split vote with regards to interest rate movement. However, despite this many officials now believe that the minutes indicate that the MPC and the Bank of England are now prepared to look at cutting rates again despite soaring inflation levels that are set to get worse. This is because of the gloomy forecasts that have been made with regards to the UK’s economy. Read more

Tags: remainder, mpc, rate, interest rates, bank of england

OFT wants review of bank accounts market

The government watchdog, the Office of Fair Trading, has been calling for a review of the bank account system in the UK, claiming that consumers are often getting a raw deal because arrangement that are currently in existence when it comes to the eight billion pound bank account market were simply not adequate. The OFT went on to state that banks were not clear enough about the charges that were applied to customers’ accounts, which makes things confusing for accountholders. Read more

Tags: bank fees, rocket, uk, trading, bank accounts, space, year

Majority of parking fine appeals won by consumers

The vast majority of consumers end up winning parking fine appeals, according to a recent report. The report indicates that a massive 94% of consumers win parking fine appeals, and this happens when they go through a public appeal against parking tickets. In six months just over 9500 Westminster issued fines were taken to an adjudicator, and over 8900, or 94%, were lost at appeal. Read more

Tags: appeal, period, majority, vast majority, resident, year, Additions, parking fines

Three way split on interest rates for July

The minutes of the latest Monetary Policy Committee meeting, which was held earlier this month, has shown that there was a three way split on interest rate movement for the month of July, indicating that setting the base rate is becoming an increasing challenge for members of the powerful committee and for the Bank of England. The minutes showed that whilst the majority of members voted to keep the rates on hold at 5%, one voted for the rate to be cut due to the slowing economy and another voted for the base rate to be raised due to soaring inflation levels. Read more

Tags: cut, year, interest rates, credit rating, movement, Brits, rise, Richest

100% mortgage customers should watch out for negative equity

Over recent years the number of 100% mortgages being taken out has risen, with fewer and fewer first time buyers able to afford to raise the deposit to purchase a property because of the cost of properties in the UK at present. Many lenders will not offer 100% mortgages to applicants because of the risks involved, but there are still many lenders that do offer 100% mortgages to first time buyers, and many first time buyers have taken these to enable them to purchase a property without the need to have a deposit available.

However, some experts have warned that consumers that are now thinking of taking out a 100% mortgage need to consider the risk of falling into negative equity. House prices in the UK have already fallen unexpectedly in September 2007, and experts have warned that the fall in property values could continue over the course of the year. This means that those taking out 100% mortgages now could soon find that they are actually in negative equity if house prices do continue to fall as predicted.

One industry professional stated: ‘There are indications that the house price boom is slowing, so anyone taking out a 100% mortgage is risking being stuck in negative equity. And if you add hefty fees to your mortgage, the risk is increased.’ Negative equity is where you end up owing more on your property than the actual value of the property.

In the past six months alone the number of 100% mortgage deals has increased from 92 to 160. Many of those that have recently taken out 100% mortgages may already have found that they are slipping into negative equity following the September 2007 price fall.

Recent Additions:

• Homeowners are not as well off as tenants
• Increasing number of first time buyers look to brokers for assistance
• Gazundering becoming more commonplace
• Unions angry over insurance job cuts
• Watchdog to probe sale and rent back

Tags: time buyers, experts, watchdog, first time buyer, hefty fees, 100% mortgage, year, boom

Increasing number of first time buyers look to brokers for assistance

Officials have claimed in a recent report that an increasing number of first time buyers are now looking to mortgage brokers for advice and assistance in finding a mortgage. It is thought that this is something to do with the tighter credit conditions stemming from the global credit crunch, and with the increased difficulties that many first time buyers are experiencing when it comes to getting a mortgage many are hoping that an experienced broker can help them to find the right mortgage. Read more

Tags: industry professional, recent months, year, Insurance, plunge, put, credit conditions, remortgage

Transact: If you’re facing repossession, get advice

Homeowners who are facing the prospect of repossession need to seek advice, according to Transact, the independent network committed to promoting financial inclusion. Read more

Tags: sand, year, Business Finance, Capitalise, coordinator, Elliot advised people, repossession, hearing

‘We need to be doing much more saving’, says expert

With the economic downturn increasingly putting a strain on people’s finances, the country needs to “be doing much more saving”, an expert has advised.

Jamie Elliott, coordinator at Transact, which is a UK-wide network for people committed to promoting financial inclusion, pointed out that Brits have one of the lowest saving ratios in the world.

“It’s a huge problem and we need to shift from a culture of borrowing and seeing borrowing as the solution to our problem[s], to living within our means.”

He added that people should also be saving for “difficult times” and the financial industry will be making efforts to encourage this, for example by allowing people on low incomes to open bank accounts with the government adding a maximum of about £250.

Recent research by Credit Action revealed that total secured lending on homes was £1,207 billion at the end of April this year, which represented an increase of 8.7 per cent over the last 12 months.

Tags: lending, GBP, business, secured lending, Transact, recession, problem, year

Prospect of monthly bank charges unpopular with consumers

According to a recent report the vast majority of consumers do not want to see the introduction of monthly banks charges even if it means that there will be a fairer system in place with regards to penalty fees for unauthorised overdraft use, bounced cheques, and returned direct debits. Research was recently carried out by MoneyExpert.com, and showed that nearly 60% of consumers did not want to see monthly account fees brought in even if there were caps placed on penalty fees. Read more

Tags: year, presiding judge, OFT states, office, United Kingdom, notice, bank charges, recent announcement

Seek advice on insurance, urges Biba

Consumers have been urged to seek advice from an insurance broker before taking out a policy by the British Insurance Brokers’ Association (Biba).

Graeme Trudgill, technical and corporate affairs executive at Biba, has said that many insurance policies have become over-complicated and could be confusing for customers.

He advises people looking for insurance to consult a broker in order to avoid over-insuring and wasting money on “too many frills”.

Mr Trudgill commented: “The broker would be the best person to advise individual customers [on what cover they need] depending on individual circumstance.”

He added that over the past few years many insurers have made their policies more comprehensive and have tried to “include too many frills rather than sticking to the basics”.

Earlier this month, financial advice website Fool.co.uk reported that the average consumer takes out six different types of insurance on an annual basis costing £1,500 per year, yet is unaware of how much they are actually covered for.

Tags: money, financial advice, Social Issues, wasting money, British Insurance Brokers Association, year, GBP, homeinsurance

Property situation ‘bad as ever’ for first-time buyers

Despite recent reports that house prices are stagnating and even falling in some areas, Firstrung has said that the property situation is “as bad as it’s ever” for people trying to buy their first home. Read more

Tags: Firstrung, home, house, first time buyers, Mortgages, year, September, market

Axa: Teenagers blow budgets in experiment

More than two-thirds of teenagers taking part in an experiment set up by the AXA Financial Task Force blew the budgets they were given for a week’s worth of household spending.

Given a budget of £248.40 each, 70 per cent of the 15 to 17-year-olds went over this amount and one child spent more than twice their budget, racking up a bill of £597.73 in seven days.

Axa is concerned that Britain’s young people are unable to cope with their finances and may find themselves in financial difficulty if they continue to overspend once they hit 18-years-old and can apply for credit cards and loans.

Research conducted by Axa shows 44 per cent of 15 to 17-year-olds are planning to get a credit card when they become adults and nearly one in five are thinking about getting a bank loan.

These concerns were raised soon after PricewaterhouseCoopers reported that in the first months of this year, 25,264 people went bankrupt or entered into an individual voluntary arrangement in England and Wales.

Tags: year, financial difficulty, teenagers, axa financial, research, Debt Financing, financial, Teenagers blow budgets

Britannia: Beware headline-grabbing rates

Britannia building society has warned consumers to be wary of “headline-grabbing rates” on savings accounts as they may not be a good long-term option.

Jayne Dono, a spokesperson for Britannia, said that a number of organisations have been attracting new savers with high initial rates on their savings.

“There’s no doubt that there are some great deals available for savers at the moment, with organisations competing against each other for business,” said Ms Dono.

However, she warned that although people may benefit in the short term, “they should also be aware of the long-term prospects and whether these organisations really have their best interests at heart”.

Recent research from the Building Societies Association (BSA) shows that the majority of building society bosses are optimistic about the year ahead, despite the credit crunch.

Building societies have experienced record savings inflows over the last eight months and they expect the trend to continue as consumers seek safer saving options, according to the BSA.

Tags: record, building societies association, new savers, number, year, Business and Economy, term, crunch

Don’t rely on credit for household bills, says expert

People should refrain from using credit, loans and overdrafts to pay their household bills, the money education charity Credit Action has said.

Although people have been increasingly using these facilities in the past year, the organisation says that it is not a long-term solution.

Capital Economics recently reported that the share of household income spent on food, bills and other unavoidable costs has risen to 31 per cent from 25 per cent over the past six years.

“It could well be that people who need to find that little bit of extra money to get them to the end of the month or pay the gas bill may revert to credit to do that,” commented Chris Tapp, director of Credit Action.

However, he said that people should be careful of becoming overly reliant on credit since resorting to these measures for long time periods could result them having in serious financial difficulties.

Tags: little bit, expert, personal finance, tapp, year, education charity, time periods, household income

Consumer Action Group: People should reclaim overdraft charges

Many people seem unaware that they can reclaim unfair bank charges, which may be leading them into greater financial difficulty, says the Consumer Action Group.

Founder of the group, Marc Gander, has said that British people often feel a sense of responsibility if they receive bank charges, however these fines could actually be unlawful.

The Office of Fair Trading (OFT) recently won the right to investigate whether overdraft charges by banks are excessive, following a court case in which banks argued that the OFT does not have jurisdiction over the matter. The banks have until May 22nd to appeal the ruling.

According to the BBC, banks refunded about £784 million to nearly 378,000 customers last year.

Mr Gander said that consumers “shouldn’t feel blameworthy, they shouldn’t feel responsible, because it’s the banks that have caused this by levying what we think are unlawful charges”.

He advised consumers to start claiming immediately if they feel they have been unfairly charged.

Tags: year, right, unlawful.the office, court case, Marc Gander, group founder, Debit card, Transactional account

More Brits may face bankruptcy in 2008, warns Addidi

More people in the UK may face bankruptcy or be forced to arrange an IVA (Individual Voluntary Arrangement) this year, Addidi Wealth has said.

The financial planning and wealth management service warns that the global credit crunch may severely affect consumers if credit is not made more easily available.

Research conducted by debt-management company TDX Group and published in April revealed that an estimated one million people are struggling to cope with an average unsecured debt of £25,000, with total UK consumer debt standing at £1.4 trillion.

It was also found that the credit crunch could double the number of people falling into to debt this year.

With the cost of living increasing, as well as the rising cost of mortgages, food bills and fuel, the research shows that the number of people taking out IVAs could double this year.

Anna Sofat, founder of Addidi Wealth, says: “Last year there were already more people declaring themselves bankrupt or having voluntary arrangements with their debtors and I think that will increase this year.”

Tags: trillion, individual, double, GBP, financial planning, TDX, voluntary arrangements, year

IVA not always best solutions, says expert

An individual voluntary arrangement (IVA) is not always the best solution for people facing crippling debt, according to a financial expert.

IVAs are seen as an alternative to bankruptcy, allowing people to settle their debts without damaging their credit rating to the same extent, however there are also drawbacks.

With an IVA, people are tied into paying their creditors for a period of 60 months, or five years. If they fail to make a payment, the arrangement can be withdrawn.

“Many people who take out an IVA initially go in with the intention of paying off their debts, but because it is so onerous they eventually fail anyway,” says David Kuo, head of personal finance at Fool.co.uk.

Record numbers of people are seeking help with debt concerns, with more than 215,000 new debt problems being reported in the first two months of this year, according to a new survey by Citizens Advice.

Mr Kuo noted that around 120 people are having their homes repossessed each day and that these were the most likely to be vulnerable and considering an IVA.

However, he said that in some cases it is best to declare bankruptcy from the outset.

Tags: new survey, IVAs, best solutions, year, credit, Mr Kuo, Citizens Advice.Mr Kuo

Bank cuts base rate, but lenders raise mortgage rates

Yesterday’s cuts in the Bank of England’s base rate, intended to help prevent the slide towards recession, were immediately undermined as lenders increased mortgage rates.

The third cut in the base rate since December will bring relief to the estimated six million home owners with tracker and variable rate mortgages, helping them save more than £30 a month on a £200,000 mortgage.

However, those on cheap fixed-rate deals which are due to expire this year may face financial difficulties.

Nationwide and Alliance & Leicester are among a number of lenders who increased their fixed-rate offers by up to 0.35 per cent.

“Many lenders are yet to pass on the recent base rate reductions – instead they are busy increasing rates, demanding larger deposits, tightening lending criteria and, in some cases, withdrawing deals from the market altogether,” commented Ann Robinson, director of consumer policy at uSwitch.com.

However a number of big lenders including Halifax, Nationwide, the Woolwich, Cheltenham & Gloucester and First Direct announced within minutes of the Bank’s decision that they would cut their standard variable mortgage rates by 0.25 per cent.

Tags: home, bank's decision, year, gloucester, number, woolwich, home owners, month

Prepaid currency cards “more competitive” than credit cards

Holidaymakers are likely to favour prepaid currency cards over traditional travellers’ cheques, according to industry experts.

The currency cards are on offer from the Post Office, Barclay’s and Lloyds TSB and allow travellers to withdraw cash abroad. Travellers load the currency they need on to the card before setting off on their holiday.

Moneysupermarket.com explains that currency cards have the edge on credit cards because there are no fees for transactions. They can also be used by individuals who have difficulties acquiring credit.

Steve Willey, of Moneysupermarket.com, said: “In terms of their use, effectively they’re a traveller’s cheque replacement.

“Once people have got comfortable with the concept and realise that there are savings to be made, then I think this will become just ‘the way to do things’.”

Travellers are also protected against fraud because the card is frozen if it is stolen and the balance and card holder’s details remain protected.

Last year statistics from APACs revealed an increase of 77 per cent of fraud associated with cards stolen abroad.

Tags: year, post office, experts.The currency cards, statistics, favour

Personal loan costs on the up

The worsening credit crisis is pushing up the cost of taking out a ce.co.uk/loans/” target=”_self”>loan, despite cuts in the Bank of England base rate.

Moneyfacts, a financial data provider, claims that the average rate on a three year £5,000 unsecured personal loan has risen by 1.7 per cent in the past year, adding an extra £300 to the bill.

Nearly a third of personal loans taken out in the past year were for debt consolidation. A quarter of those borrowers ran into further debt, and 85 per cent of all those taking out loans were not asked to pay off existing debts by their lenders.

Worryingly, 70 per cent of loan applicants were not asked for proof of income, according to price comparison service uSwitch.com.

Mike Naylor of uSwitch.com commented: “With more than 7,716 loan repayments being missed every day and record write-offs, you might think that lenders had learnt their lesson.”

Figures released by the Bank of England last week showed that new consumer credit rose by £2.4 billion in February, compared to an increase £900 million in January.

Tags: credit, crisis, comparison, year, finance

Consumers should “research the market” when looking for a mortgage

It is important for consumers to shop around when looking for a mortgage, one property expert has claimed.

According to the Council of Mortgage Lenders (CML), buyers should do all the “obvious things” when looking for a mortgage with researching the market being one of them.

Sue Anderson, a spokesperson for CML, said: “Knowing the product range that is out there is obviously important for borrowers so that they can assess whether the person who is advising them is pushing them towards a product that looks suitable for them.”

Ms Anderson added that there are a number of ways that allow you to do this, such as checking the Financial Service Authority’s comparative tables, and the range of published sources on the web from various commercial providers”

In February 2008, the CML reported that there had been a move-away from fixed-rate products as consumers became increasingly attracted to tracker products.

Meanwhile, the mortgage market has been badly affected by the credit squeeze. In October last year, Moneyfacts reported that 40 per cent of mortgage products had “disappeared”.

Tags: mortgage, year, credit, October, finance

Storm insurance costs hitting the roof

The roofs of up to 1.5 million homes in the UK have been hit by storms in the past year, costing consumers £4.5 billion in repairs, according to insurance experts.

Research from Halifax Home Insurance shows that the average cost of repairing wind damage has risen to £2,800, which equates to 12 per cent of the average British salary.

Martyn Foulds, senior claims manager at Halifax Home Insurance, said: “Homeowners without adequate buildings insurance cover risk finding a huge hole blown in their finances by the cost of repairs.”

He added that the increasing number of incidents of extreme weather conditions, such as wind and flood, “make it more vital than ever for homeowners to take proactive steps to protect their financial and physical security before disaster strikes”.

Further findings from the firm reveal that the average affected house needs 127 tiles replacing, a figure which equates to more than 200 million across Britain.

Meanwhile a study in Germany predicts that financial losses incurred by bad weather could rise to 37 per cent in the UK.

Tags: huge hole, halifax, disaster strikes, adequate buildings insurance, security

More first time buyers purchasing homes together

Increasing numbers of first time buyers are opting to buy homes as a couple rather than individually, claim independent mortgage experts.

John Charcol said that in the past, lifestyle choice and affordability have meant that there are more single first time buyers, but this figure was reversed last year with joint buyers making up half the home purchases compared with 45 per cent the previous year.

Katie Tucker, technical manager for John Charcol, said: “Buying together is a very sensible choice in terms of affordability. Not only for splitting the mortgage and the bills, but more cuddling up should save you on the heating!”

She added that increases in property value and mortgage payments with incomes remaining the same are all factors which have contributed to the buying trends.

Ms Tucker also said that more women are buying property jointly with more men taking the decision to settle down with a partner for their first home.

Meanwhile, research from MoneyExpert.com showed that as many as 1.39 million homeowners have switched their mortgage provider in the past six months.

Tags: six months, year, john charcol, finance, Ms Tucker, manager, business

Credit card balance transfers better value than personal loans

Consumers looking to take out a personal loan may want to consider a credit card balance transfer instead, claim financial experts.

According to research from everyinvestor.co.uk, a borrower requiring £10,000 could save over £1,000 over a four year term if they choose to transfer their credit card balance rather than applying for a loan.

Chris Gilchrist, editor with the consumer advisors, said that lenders have raised interest rates on personal loan rates sharply in the past six months.

“Credit card companies continue to offer lengthy zero per cent balance transfers and even though you may pay balance transfer fees, this still works out well below the interest you would pay with a personal loan,” he added.

Industry commentators have predicted the end of the zero per cent interest balance transfer for the past 18 months according to the experts.

However, credit card companies are expected to continue to offer the rate in a bid to attract more customers.

Meanwhile, new research from Fool.co.uk has revealed that up to one in eight credit card holders in the UK have had their credit limits cut.

Tags: loan, debt, industry commentators, year, research, interest balance

Households to be worse off in 2008

Households will be financially worse off in 2008, according to Ernst & Young ITEM Club’s latest forecast for the UK economy.

The research, using the Treasury’s own economic model, describes public finances as a “mess” and anticipates the situation to get worse with slower growth and slower tax revenues predicted.

Speaking to the Independent, Peter Spencer, chief economic adviser to the ITEM Club, said: “Now that the economy is slowing sharply, the public finances will deteriorate equally rapidly.”

He added: “We have revised our forecast of this year’s current deficit up to £14 billion, compared with the Treasury’s pre-Budget report forecast of £8 billion.”

Experts have predicted that the Bank of England will cut interest rates at least three times to 4.75 per cent, or to a figure even lower, from the current 5.5 per cent over the course of the year or by 2009 if the economy continues to slow.

Meanwhile, research from property expert Right move shows that house prices are rising at their slowest rate for two years.

Tags: bank of england, United Kingdom, Business Finance, Right Move, rate, year, Economic, budget report

Consumers need to spend carefully at Christmas

Consumers should be careful with their Christmas spending and ensure they do not put more than they can afford to pay back on credit, warn financial experts.

The Consumer Credit Counselling Service has said, that despite it being the festive season, people still need to remember that money spent on credit has to be repaid over the course of the year.

James Ketchell, spokesperson for CCCS, said: “The amounts you put on for Christmas spending might be done in good faith and for good reasons, but they do have to be measured by common sense too.”

CreditExpert.co.uk has predicted that, despite recent interest rates rises and the credit crunch, the majority of Christmas consumers will not be reducing their spending.

The news comes even though 29 per cent of respondents admit money is tighter this year.

According to statistics from Credit Action, the total personal UK debt stood at £1,380 billion at the end of September.

Tags: year, News, spending, economics, sense, statistics

Consumers expected to spend £2.7b more this Christmas

An estimated £2.7 billion more is to be spent this Christmas by consumers compared with last year, according to a survey by Sainsbury’s Bank.

People intend to spend £11.85 billion more on shopping in the last week before Christmas than in 2006.

The findings also show that 18 per cent of this figure, approximately £2.1 billion, will be paid by credit card.

Donald MacLeod, head of cards, Sainsbury’s Bank, said: “I was surprised at…the fact that people were going to spend more this year than last year. All the press comment at the moment has been about there being a squeeze on [spending], but this doesn’t appear to be the case.”

He added that buying gifts during the build up to Christmas can benefit consumers as some retailers are already offering discounts. Unfortunately the risk is that some goods may already be out of stock.

Mr MacLeod also said that credit cards are “a very convenient way of doing your Christmas shopping”, as using them does not require consumers to carry cash.

Tags: week before christmas, sainsburys, Retailing, year, Sainsbury, press, Mr MacLeod, buying gifts

2008 set to be ‘a tough year financially’

2008 is “going to be a bit of a shock” and a “tough year financially” for consumers, according to a financial expert.

The end of fixed rate mortgages and the rising price of gas and electric bills both contribute to the more pessimistic financial outlook for next year, says AWD Chase de Vere.

Susan Hannums, savings manager for AWD Chase de Vere, said: “I think it is going to be harder to save, but the thing we need to drum in more than anything else is that we’ve got to start paying off and get away from using credit all the time.”

She added that borrowing “is really what got us here in the first place”.

Consumers need to think of other methods of saving to “turn things around”, concluded Ms Hannums.

Research from Credit Action earlier in the year revealed that total personal debt in the UK has reached £1.25 trillion.

Tags: year, Economic history, personal debt, manager, Vere, anything, Business Finance, concluded ms hannums

Building Society issues reassurance on remortgages

The Newcastle Building Society has told mortgage holders not to panic after the City’s financial regulator, the Financial Services Authority, said it could be difficult for remortgages to go ahead “on favourable terms” next year.

Steven Marks, Newcastle Building Society’s lending expert, said: “From this week’s headlines, many people will be forgiven for thinking that they won’t be able to get a mortgage or competitive remortgage deal from their lender next year.”

Even though interest rates came down slightly this week, such a statement could leave borrowers feeling “unnecessarily uneasy”.

However he emphasised that interest rates are historically low.
The cut in the Bank of England’s base rate should also assist the outlook, Mr Marks added.

Other than Northern Rock, most mainstream lenders are still keen to do business and competitive rates should still be available next year he concluded.

Newcastle Building Society has just announced the launch of a full equity release brokerage system.

The expansion of the advisory service arrives six months after the FSA introduced regulations relating to these products.

Tags: equity release, expert, expansion, Newcastle Building Society, loan, remortgage, year, Society’s lending expert

Festive spending not affected by disposable income

Consumers will still buy what they need to be able to celebrate Christmas properly, even if their disposable income does not facilitate such spending, an industry expert has said.

According to the British Retail Consortium (BRC), both consumer confidence and disposable income have fallen this year, meaning that people may both be and feel “less well off”.

Head of media at the BRC, Richard Dodd explained: “[This] is a result of interest rate rises and also other costs having risen sharply, as well as mortgages, including utility bills, fuel bills and tax bills.”

He added that despite people being less well off and having less to spend, people will still “have the presence of the food and drink they want for Christmas”. This means that retailers will not suffer dramatically even though it may not be a “spectacular” year.

Deloitte have released predictions for spending which, it says, will increase by seven per cent on last year’s figures, with average spending per capita estimated at £706 up from £662 last year.

Tags: year, tax, food and drink, disposable income, cent, Personal life, fuel, fuel bills

Rate falls ‘will not affect mortgage market’

Any drops in the interest rate over the coming year will have little affect on the mortgage market, an industry expert has said.

According to Firstrung, following the credit squeeze this year the market is “completely detached” from the Bank of England base rate, with the average rate at two per cent higher than that of the base rate.

Paul Holmes, chief executive of the mortgage brokers, commented: “We always used to look at Bank of England decisions to see what our mortgage rate was going to do.

“But all of a sudden the dislocation, the gap, is huge between what the lenders do and what the Bank of England does.”

He added that in excess of 40 per cent of mortgage products have been “stripped” from the market, although there is no shortage of products.

Furthermore, he said, there is a need for a “contraction and consolidation” of the market, rather than increased product innovation.

Tags: average rate, base, base rate.paul holmes, year, England base rate, bank of england, lenders

GFA found to be ‘feasible’

The Thoresen Review of Generic Financial Advice released yesterday has concluded that it is a “feasible” project.

Appointed by the Economic Secretary to the Treasury, Otto Thoresen carried out an examination of the practicality of providing a national platform for generic financial advice.

The investigation found that the benefits of delivery such a service would “outweigh costs by 3.5 to one”.

It also set out the most important qualities for a national GFA service as found in consumer research. These stated that it should be “supportive and informative” as well as “persuasive” without being critical.

Furthermore, it should be “available to all” and “not linked to a product sale” while also be “jargon busting”, advising on debt management, taxation and benefits.

Mr Thoresen said: “Complete impartiality and effective marketing will be critical. But it’s also essential to design a system which will be of genuine benefit to people and which can be sustained over the longer term.

“We are currently running pilot schemes to test out elements of a national system and the findings will enable us to develop the proposals further in the months ahead.”

The review’s final report will be published early next year.

Tags: Otto Thoresen, economic secretary, product, debt, important qualities

Personal loan rate increases ‘disproportionate’

There have been widespread increases in personal loan rates in wake of the interest rate hike in July, according to recent research.

Figures show that the rises are disproportionate to the interest rate increase with an average increase of one per cent APR to personal loan rates since July this year compared to the 0.25 per cent base rate increase.

Differences also exist between offline and online deals, with APR currently at 8.7 per cent offline and 7.7 per cent online.

Mike Naylor, personal finance expert at the company carrying out the research, uSwith.com, said: “There are already huge variations in the loan rates available to consumers amongst both online and offline deals.

“Throwing the personal pricing smoke screen into the melting pot is just causing further confusion, making it a complete minefield for consumers to shop around and get the best deal.”

He added that consumers should exercise “caution” if offered “personal pricing” for offline deals as this was not necessarily in their interests.

Banks have also been criticised recently for excessive charging on credit cards and overdrafts as well as on currency exchange.

Tags: year, interest, exchange, loan rate, rate increase, economics, Currency, smoke screen

Lloyds TSB: Islamic mortgage demands ‘through the roof’

The amount of people taking out Sharia-compliant mortgages has risen dramatically in recent years, according to Lloyds TSB.

Islamic mortgages are designed for Muslims who would not want to take out a regular mortgage due to Sharia law restrictions.

According to media relations manager at Lloyds, Emile Abu-Shakra, up until recently, many Muslims have been obliged to rent “their whole lives”.

He said: “In the last couple of years, we’ve gone from offering services just in five branches – in Luton, Birmingham and London – to now offering them in every single branch around the country.

“So you can see that demand really has gone through the roof.”

Sharia Islamic Law states that making money from money is not permitted, therefore all forms of interest are forbidden.

Risk sharing is the basis of the Islamic financial model, whereby the bank and customer share any risk involved in an investment in an agreement that sees any profit divided between them.

The latest statistics from Datamonitor show the Islamic mortgage market will grow by 47 per cent per year and may be worth £1.4 billion by 2009.

Tags: Islamic, country, offering services, couple, mortgage market, year, Islam, Emile Abu-

Rush on remortgages amidst fear of rate rises

July of this year saw over a billion pounds worth of mortgages being taken out each day with many homeowners deciding to remortgage amidst fears that that interest rates would continue to rise following five interest rate hikes in the space of a year.

The highest in over six years the base rate currently stands at 5.75%, following five rate hikes of 0.25% each since August of last year. Many homeowners have had to cope with rising repayments as their mortgage repayments have soared along with interest rates.

According to figures from the Council of Mortgage Lenders nearly £35 billion was borrowed in the month of July on mortgages, which reflects a 13% rise on the amount that was borrowed in July of last year. According to the CML this increased figures result from the surge of homeowners that have decided to remortgage in order to try and get a better deal on their mortgage in the light of the series of interest rate rises that have taken place – and the threat of further interest rate rises that may yet take place.

A spokesman from the British Bankers Association stated: ‘Longer-term trends in mortgage lending are little changed but July’s strong rise was surprising, given the expected cumulative impact of higher interest rates. The resilience shows the popularity of home ownership and also reflects more remortgaging activity.’

An official from the Building Societies Association stated: ‘As mortgage payments increase, household finances are likely to be squeezed further. Even if interest rates are near their peak, potential borrowers need to think about all their outgoings to make sure they do not overstretch themselves financially.’

Tom Smith
26th September 2007

Tags: personal finance, August, increase, Longer-term trends, surge, remortgages, year, british

Credit card balance transfer fees rise

The cost of transferring balances across credit cards has been steadily rising in the past year, research from MoneyExpert.com has found.

Since being forced by the Office of Fair Trading to cut their charges, credit card providers have raised transfer fees from on average half a per cent to 2.67 per cent.

This tactic has been seen by some as a strategy to earn back some of the money the credit card providers lost when they were forced to cut their charges.

Sean Gardner, chief executive of MoneyExpert.com, said: “What goes down must go up seems to be the experience in the credit card industry.

“Card firms have lost out since they were forced to cut so-called default charges so now customers are losing out as balance transfer fees increase.”

However, though balance transfers are increasing, consumers should still be on the look out for better rates and be willing to switch, Mr Gardner said.

Meanwhile, the overall amount of personal debt in the UK now exceeds one trillion pounds, according to the debt organisation Credit Action.

Tags: amount, Credit Action, chief executive, default, year, past year, action, credit

Mortgage figures fall in July

July saw a decrease in the amount of mortgages being taken out, according to figures released recently by the Council Mortgage Lenders (CML).

The value of those mortgages that were given also fell, the CML statistics showed.

However, when not accounting for lending for house purchase or remortgages, lending overall actually grew to £7.8 billion in July, its highest-ever figure.

Michael Coogan, CML director general, commented: “A slight fall in lending between June and July has emerged for the third year in a row, so of course we cannot read too much into a single month’s figures.

“But the long-anticipated slowdown in the housing and mortgage markets may now be beginning to materialise.”

Affordability is “ever more stretched” he added, but Britons will not see any let up in the financial troubles they face soon.

Meanwhile, Halifax’s latest house price index has shown that the average price of a house in England and Wales has risen to nearly £200,000.

Tags: economics, year, United States Department of Housing and Urban Development, General, single month, Council Mortgage Lenders, mortgage markets, slight fall

Holidaymakers ‘lie on insurance claims’

A significant number of people from the UK confess that they give false information when making a holiday insurance claim.

According to research by Direct Line, 11 per cent of British holidaymakers increase the overall value of a claim.

Another five per cent admit that they have added extra items to an insurance claim. Of the 13 per cent to have made a travel cover claim, 15 per cent admit to lying.

“The telling of a ‘little white lie’ is fraud however they chose to justify it,” said Chris Price from Direct Line. “Contemplating committing fraud is a serious matter and we would urge anyone about to claim on their travel insurance not to take this lightly.”

The study revealed that jewellery was the most popular item for which to make a false claim, with 25 per cent seeking money back for such items.

A recent report from Sainsbury’s Bank showed that 8.8 million people from the UK booked a last-minute summer holiday this year – but in their haste to get away 19 per cent forgot to arrange travel insurance.

Tags: cover, Chris Price, Mill, year, value

Last minute getaways go uncovered

Holidaymakers may think they have bagged a bargain when they jet off on a last-minute break, but forgetting to organise travel insurance can leave them out of pocket.

Research carried out by Sainsbury’s Bank revealed that 18 per cent of British adults will take a last-minute holiday this summer – but 19 per cent won’t bother with travel cover.

Steve Johnson from Sainsbury’s Bank said that cheap late deals are good news for holidaymakers, but warned that “without appropriate insurance in place a holiday can soon turn into a nightmare if disaster strikes”.

He added: “The stress and cost involved in sorting out any potential problems could run into hundreds or thousands of pounds, surely cancelling out any money saved on a late deal.”

The report estimated that some three million people travel overseas each year without having arranged travel insurance.

The Post Office’s head of travel, John Howells, said that insurance can be sidelined when planning a break. “Our figures prove that travel insurance is all too often forgotten in the excitement of getting ready to go on holiday, or even worse, it is considered by some to be non-essential.”

Tags: year, PRWEB, travel insurance, travel insurance.the post, post, Steve Johnson, cost, British adults

New term sees Brits sort out finances

For school children, September and the new school term means a fresh start, but it seems that at this time of year, adults too are following suit and turning over a new leaf.

Research from Lloyds TSB shows that in the autumn, some 56 per cent of adults vow to get fit, 34 per cent vow to spend more time with loved ones and 36 per cent promise to sort out their finances.

Over a quarter (28 per cent) of those who said they wanted to get their financial affairs in order planned to move their current account and over a third (35 per cent) are looking for an account that will offer higher credit interest rate, with changing credit cards and finding more competitive insurance also a priority.

A positive three-fifths think they will stick with their new commitment to better financial management.

Ian Larkin, managing director of consumer banking for Lloyds TSB, said: “Time and again, people tell us that sorting out their finances is a top priority, but many overlook the difference that a competitive current account can make to their finances.”

Some banks, including Lloyds, have staff dedicated to making switching accounts an easy and smooth process, so that new term financial resolutions are painless as well as beneficial.

Tags: Brits, year, competitive insurance, higher credit, Credit card, leaf

New car loans figures from Halifax

New research from Halifax has shown that January and August are the most popular months for applying for a car loan.

According to Halifax Unsecured Personal Loans, the most popular age group for taking out such a loan – forming around half of total applicants – was the 30-49 group.

The figures also show that 67 per cent of loan applications were made by men

Neil Chandler, head of Halifax Unsecured Personal Loans, said: “Purchasing a new car takes a lot of time and thought as it is a big financial commitment.

“It is important to choose a finance deal which suits you best, leaving you free to sit back and enjoy your new car.”

More generally, the new report says that there are currently around 31 million vehicles on Britain’s roads, with 2.3 million purchased last year.

The research was undertaken by Halifax Unsecured Personal Loans in anticipation of the new 57 licence plates, which are to hit British forecourts next month.

Tags: year, group, new 57 licence, report, car loan.According, credit, new car loans, loan applications

Mortgage lending hits record level, says CML

Mortgage lending has hit a new high, according to latest statistics from the Council of Mortgage Lenders (CML).

Gross lending hit an all-time July record of £34.4 billion, according to figures released by the industry body today.

Although the amount is slightly down on June’s results, this nevertheless represents a 13 per cent rise on the equivalent figures for 2006.

A CML spokesperson said that the record figures did not mean that the trend was set to increase: “As we move into the autumn the cumulative effects of [interest] rate rises will become more pronounced, and we expect this to feed through to lower levels of mortgage lending as the year progresses.”

Interest rates were raised by the Bank of England in July to 5.75 per cent, the fifth such increase in a year.

Commenting on the CML’s figures, chief economist at the Royal Institute of Chartered Surveyors (Rics), Simon Rubinsohn, also counselled caution, saying that “the turmoil in financial markets will push up mortgage costs for in vogue longer term fixed rate deals and will further slow the residential property market.

“With 90 per cent of borrowers opting for fixed rate security, those who are already financially stretched will find themselves paying a higher price for the added peace of mind,” he added.

Tags: record, chief economist, council of mortgage lenders, body, Institute, June, peace, year

Lifetime balance transfers

One big advantage that a lifetime balance transfer has over a consolidation loan is that it offers far greater flexibility when it comes to payments, a leading bank said today.

With credit card users paying hundreds of millions of pounds worth of penalties last year, looking to avoid such fees ought to be a big priority among British consumers.

“You know exactly what you are going to pay and it is a guaranteed balance,”
Donald MacLeod, head of credit cards at Sainsbury’s Bank, said.

“[It] is probably one of the most straightforward ways of using a credit card: you transfer the balance [and] you know what you’re going to get,” he added.

“One of the big benefits of the lifetime balance offer compared to loans is that there are no penalties so you’ve got complete flexibility of payment – so as long you give a payment you can pay as much as you want or as little as you want, whereas with a consolidation loan your payments are set in stone from the start.”

Mr MacLeod also said that, far from encouraging debt, the flexibility of payment offered by balance transfers made them a good way of restructuring existing debt.

Tags: lifetime balance transfers, set in stone, way, head of credit cards, Stoozing

HSBC removes mortgage fees in promotion

In a reflection of the UK’s increasingly competitive mortgage market, high street bank HSBC has announced that it will axe all mortgage fees for two months, effective immediately.

The bank said that it was making the move as a reaction to the ongoing Financial Standards Authority (FSA) investigation into the charges.

Consumer groups have complained to the FSA that charges such as exit fees have been ramped up in recent years , while not costing providers any extra money over that period.

Head of mortgages at the bank Rob Chesters said: “With some lenders recently bowing to pressure to scrap their exit fees, HSBC has decided to stay one step ahead by removing all fees on its standard mortgage range until the end of September.”

Some advisers say, however, that the promotion might not be all that it seems. “With HSBC’s rates higher than many rivals, homeowners could be better off choosing to pay fees and head elsewhere”, This Is Money counsels.

The FSA is due to report its findings later in the year.

Tags: year, end, consumer groups, United Kingdom, mortgage market, bank rob chesters

Credit card users ‘needlessly wasting millions’

UK holidaymakers lose in excess of £326 million every year as banks and building societies unnecessarily charge them for using their credit and debit cards overseas, it has been revealed.

Figures produced by UK payments association Apacs show £12.3 billion worth of transactions were made on credit cards overseas last year, with customers estimated to have been billed £326.2 million for this privilege, based on an average charge of 2.75 per cent.

Indeed, Nationwide divisional Director Jeremy Wood points out that many credit card providers have actually increased their charges for overseas transactions recently.

For instance, Lloyds TSB is to raise the charge on its debit card from 2.75 per cent to 2.99 per cent and NatWest has effectuated a similar hike from 2.65 per cent to 2.75 per cent.

Meanwhile, Mr Wood has highlighted the fact that Nationwide’s credit and debit cards are fee-free when used abroad.

“People who are planning to go abroad over the next few months should be aware of the hidden charges that most card providers impose which are both costly and unnecessary,” he commented.

“Anyone using a Nationwide debit card or credit card will not be charged any foreign usage fees and will therefore have a little more money to help them enjoy their holiday.”

However, a charge is applicable for ATM withdrawals when using Nationwide products in foreign countries.

Tags: Jeremy Wood, divisional Director, anyone, foreign usage fees, building societies, nationwide divisional director, year, Credit card users

Uni sacrificed for mortgage

The difficulties associated with getting onto the property ladder are forcing many youngsters to abandon their education.

New research shows that ten per cent of 18-24 year olds are choosing not to go to university so that they can save some money towards their first home.

With house prices seemingly on an endless upward curve, it is now more difficult than ever to purchase a first home and the costs of university are an unwanted burden for many.

Lloyds TSB carried out the research which highlighted that many youngsters are making big sacrifices in order to get a mortgage.

One in five say that they have abandoned the dream of forging a career in their preferred sector, opting instead for a better paid job that they do not enjoy.

In addition, a further one in six say that they are doing two jobs to save some money, while 54 per cent are living at home indefinitely.

“The fact people are willing to forgo their education highlights the importance of homeownership to the younger generation,” said Alison Burns from Lloyds TSB. “However, these extreme measures may not always be necessary, as the research shows a number of misconceptions about the modern housing market.

“Almost 65 per cent of those we spoke to believe a ten per cent deposit is an essential requirement but this is not the case. Mortgage providers are becoming increasingly flexible to accommodate the changing circumstances of first time buyers.”

Tags: year, addition, first time buyer, house, Alison Burns

Youngsters have big ambitions

A generation of financially ambitious youngsters are heading into the world and they have grand plans for where they want to be in the coming years.

Research by Alliance & Leicester shows that around 24 per cent of today’s 16-21 year olds who currently work expect to be earning £40,000 within the next ten years.

That would mean they would be earning almost double the national average wage which currently sits at £23,244.

The ambition to earn more means that the majority of people in this age group (81 per cent) expect to have a mortgage and own a property by the time they reach 30.

A recent survey by National Savings & Investments labelled many British savers as fantasists but today’s 16-21-year-old working population has reason to feel confident.

Figures show that 26 per cent of people who chose to go straight into fulltime employment are now debt free and can begin thinking about saving up some money for their future plans.

“These days, young people have high financial and lifestyle aspirations and getting on the career ladder early can be the quickest way to achieve their goals for many,” said Helen Palmer from Alliance & Leicester.

“As a group they recognise the growing trends of graduate debt and, in contrast, the potential advantages of going straight into employment – especially climbing the first rung of the property ladder and earning substantial amounts of money.

“It is important for this group to maximize the potential of their hard earned cash and this isn’t about clever investment choices or making timely and strategic financial decisions – it’s about basic management of money in a current account,” she added.

Tags: basic management, Financial services, helen palmer, year, youngsters, average, age group, recent survey

Credit card rewards not being claimed

Millions of credit card holders are failing to take advantage of the rewards that are on offer to us.

Research by the Post Office has found that around two-thirds of us are lured by incentives on a new card but do not cash in.

The most common rewards that are available to card holders include cashback offers and other bonuses but 60 per cent are not benefiting from them.

Even those who do take advantage do not use them to their full potential, with the average reward claim being just £37 a year.

Credit card holders are being encouraged to take advantage of the rewards they are offered or opt for a card that offers more long-term benefits.

“We urge credit card holders to look at the long-term value offered by their credit card – particularly as almost a third (32 per cent) of credit card users have held their card over five years.”

It appears that this message is already prevalent among card holders, with 60 per cent of those asked stating that they would stick with one card if they could find one which offered long-term value across the board.

In addition, card holders named low interest rates, nought per cent on balance transfers and nought per cent on purchases as the most desirable features.

Tags: desirable features, year, Loyalty program, Business Finance, advantage, board.In addition, interest rates, nought

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: country, homes.Home improvements, 12 months, home improvements, quarter, Mortgages, work

Glastonbury freebie for over-50s

Glastonbury festival is fast approaching and insurance firm Saga is offering a financial break to the over-50s who plan on attending.

Thousands of people aged 50 or over attend Glastonbury whenever it is on but with ticket prices escalating, it is proving to be more difficult to afford with each passing year.

In light of this, Saga says that it will refund the amount paid for a motorhome pitch by anyone who is aged over 50 and has Saga Motorhome Insurance.

The price of a ticket this year is £140 and Saga believes that many over-50s will struggle to meet that cost.

Despite this, the festival remains popular with the older generation, many of whom will have attended the original event.

Prices have risen drastically since that first festival in 1970 when the price of a ticket was just £1.

People wishing to take a motorhome with them to Glastonbury will have to fork out an additional £50 but if they have Saga Motorhome Insurance this will be refunded as long as they keep their photo ID ticket.

Tags: saga, insurance firm saga, photo id, Somerset, year, photo, amount, Saga Motorhome

Brits expect rates rise

The majority of Brits are expecting interest rates to rise again this year.

Lloyds TSB has published its Consumer barometer in which it revealed that most of us (77 per cent) are fully expecting another increase.

This is bad news for those with a mortgage, loan or credit card, however, the fact that most borrowers are expecting a rise may help them to be properly prepared.

Confidence in job prospects and job security fell during May, with more people believing that their position is vulnerable compared to the month previous.

“Last month’s interest rate rise did little to convince consumers that rates had reached a peak,” said Trevor Williams, chief economist at Lloyds TSB Corporate Markets.

“In line with the prevailing opinion of the financial markets, consumers believe rates will increase further this year.

“We’re just beginning to see the impact of May’s rate rise on consumers with sentiment on job security and prices starting to cool.

“Even so, there is still some way to go before the Bank of England will be reassured – they have emphasised that for inflation to stay low, inflation expectations must be anchored at low levels,” he added.

Borrowers concerned that interest rates are likely to increase in the coming months should try to account for a rise in repayments when budgeting.

Tags: lloyds tsb, Financial services, majority, Brits expect rates, Brits, year

New buyers need parents’ help

It is becoming so difficult for first-time buyers to get onto the property ladder that 31 per cent anticipate getting help from their parents to do so.

A further 35 per cent are so daunted by the housing market that they feel they need financial help in order to get their first mortgage,

Research from the Council of Mortgage Lenders (CML) shows that younger people are genuinely struggling to get onto the property market without some kind of financial help.

Figures show that 23 per cent of all homeowners had help from their parents to get where they are today, while that number soars for younger owners.

Of those aged under 29 or younger, 39 per cent had help from their parents and it seems as though this trend is set to continue.

“We were intrigued last year to find that, while around eight out of ten people believed it had never been harder for first-time buyers to enter the market and that action was needed, only eight per cent of them felt that parents should do more to help,” said Bob Pannell, head of research at CML. “Our new research helps to explain why.

“Over the past few years, parents have already been providing significant help to younger home-buyers and there is uncertainty about whether they can do even more.”

Of those who said they think they will need financial help to get onto the property ladder, only 62 per cent expect to get it.

Tags: year, housing market, mortgage, Banking, younger owners.Of, kind, order, Council

Buy-to-let grows, so does rent

The number of people taking out a mortgage for a buy-to-let property has remained constant despite a series of interest rate rises in the last year.

Some experts had predicted that as the cost of borrowing increased, landlords would shy away from increasing the number of properties they own.

However, figures from specialist lender Paragon show that they are continuing to increase their portfolios and simply charging increased rent to cover the costs.

In the last three months alone, the average rent charged on a buy-to-let property grew by 6.5 per cent.

“The market remains buoyant for both intermediaries and lenders, with good volumes of business for both property purchase and for refinancing of existing portfolios,” said John Heron, managing director of Paragon.

“Investors are encouraged by the strength of tenant demand, which enables them to increase rents on existing tenancies when they are renewed and apply a higher rent to new tenants than they would have charged three or six months ago.”

Almost a third of landlords said that they had increased rent due to rising borrowing costs.

Tags: specialist lender, Financial economics, economics, strength, cent."The market, refinancing

Contactless cards are on their way

The UK banking industry has confirmed that plans are in place to roll out contactless technology for debit and credit cards.

We could see the new system being put in place as early as September of this year, with consumers receiving new cards and retailers getting new receivers.

The UK payments association Apacs has revealed that transactions on the contactless cards will be limited to no more than £10 and users will not need to enter their pin number each time they make a purchase.

Apacs is assuring customers that their cards will remain safe and says that every now and then they will be required to enter their pin number for security reasons.

The cards will initially be introduced in London, spanning from the City to Canary Wharf, with a larger roll out planned across the whole of London and eventually nationally by the end of 2008.

The cards are being touted as an easier and quicker way for consumers to purchase everyday items and the banking industry believes that their introduction will encourage shoppers to use their cards rather than paying for low-value items with cash.

“We are confident that consumers in the United Kingdom will be quick to adopt contactless payments as they are faster and more convenient than cash increasing both the number of cards in issue and, as retailers benefit too, places where they can be used,” commented John Bushby from Mastercard Europe.

Cardholders should wait for correspondence from their card company to see what they need to do to get a contactless card.

Tags: year, introduction, Cardholders, card, bank

Bank accused of wasting court’s time

One of the leading UK banks has been accused of wasting time by a judge, and has been ordered to pay the court costs of a woman that sued the bank after trying to reclaim unfair and unlawful charges that the bank had applied to her account for going overdrawn, returned cheques, and unpaid direct debits.

Lloyds TSB will have to pay court costs of £85.41 after the Bristol County Court judge, Andrew Kearney, accused the bank of ‘acting unreasonably’.

The plaintiff, Vivien Lloyd, had tried to reclaim fees that amounted to £655, but wrote to the judge after the bank spent a year wasting time before offering to refund the fees. The judge stated that the bank had no intention of defending its charges in court, and therefore accused the bank of wasting time and ordered it to pay the court costs incurred by the plaintiff.

The plaintiff had initially written to Lloyds TSB in March 2006 to reclaim her charges, many of which had been accrued by her son, Gary.

She stated: “The terrible stress it put me through – it was driving me mad. I’m absolutely ecstatic – it was our living money, our food money.”

She added that the bank had continued to refuse the refund until earlier this year, with just one week to go before the court hearing, at which point Lloyds offered her a full refund of charges. 

A spokesperson for the bank stated:  “We are surprised by this judgement as we firmly believe we have the right to lodge a defense in any legal action brought against us. We have been unable to trace any notification from the court about this application for a further payment of £85 and so did not have an opportunity to challenge it before it was made.”

Tom Smith
4th May 2007

Tags: unfair, year, legal, bank, appeal, court, defense, charges

Hips will wipe out sellers’ savings

People selling their home in the UK are currently making savings because the market is so competitive but all of that is about to change.

According to mortgage provider the Woolwich, sellers are managing to save money by striking deals with agents who are keen to see the property on the market.

This is despite the fact that property prices have risen by 11.1 per cent in the past year.

“The market definitely favours sellers at the moment and the lack of property on the market is helping them negotiate deals with estate agents and, to a lesser degree solicitors, as agents are desperately trying to find enough good quality property to satisfy the increasing demand,” said Andy Gray, head of mortgages at the Woolwich.

“As a result the cost of moving for sellers has decreased by approximately ten per cent since last year ¬¬- it now costs on average £4,666 to sell a home compared to £5,181 last year.”

Although sellers are currently saving on the costs of moving, experts are predicting that this will change when it becomes compulsory for home sellers to provide home information packs (Hips).

The new rules come into effect on June 1st 2007, with Hips set to cost a seller in the region of £500.

Although the cost of Hips is clear, the Woolwich claims that 77 per cent of estate agents do not believe they will improve the house-buying process.

Tags: good quality property, lesser degree solicitors, United Kingdom, mortgage provider, year, degree, deals, information packs

Chip and PIN in the home

Online banking may be about to change forever after Barclays Bank revealed that it will be sending Chip and PIN card readers to people’s homes.

The initiative is designed to reduce the cases of online fraud and beef up security for those who choose to bank over the internet.

Customers who use their Barclays online account to make payments to a third party will receive their PINsentry device later this year.

It is hoped that by introducing the new devices, customers will no longer be required to remember a user name and password to make transactions and can instead simply punch in their PIN number.

“Barclays is constantly working to help protect customers and their money and that is why we have invested in this system,” said Barnaby Davis, director for electronic banking at Barclays.

“PINsentry is the next generation of fraud prevention technology and Barclays is proud to be the first organisation in the UK to roll it out to its customers.

“The popularity of Barclays online banking service comes down to convenience and security and the introduction of PINsentry will enhance both of these features,” he added.

Barclays plans to roll out the new service to half a million customers across the UK by 2008, with this number increasing in time.

Tags: uk, Banking, barclays online banking, online fraud, fraud

Savers are short-sighted

Millions of consumers are only saving money to achieve their short-term goals, new research has indicated.

An estimated 7.5 million Britons save cash just to meet their immediate needs, according to a report by website Unbiased.co.uk.

A further 3.8 million are thought to be “frivolous” spenders, driven to part with their cash because of their desire to acquire certain purchases, rather than their ability to afford them, according to the study.

The report, commissioned by IFA Promotion and based on official data and a YouGov survey of consumers, concludes that there are two frivolous spenders for every Briton who is financially aware.

Dividing the nation into five categories according to their spending habits, the study also suggests that even one in ten “bargain” spenders do not have any savings.

“This year’s research into the nation’s propensity to save shows some improvement, but it is disappointing that we still define ourselves as a nation of spenders rather than a nation of savers,” said Unbiased.co.uk chief executive David Elms.

News that many Britons are failing to save for a rainy day follows research published yesterday indicating that the majority of the nation’s wealth is now tied up in property rather than traditional financial assets such as savings.

Some 55 per cent of the UK’s wealth is now linked to equity in properties, the study commissioned by the insurer Prudential found.

Tags: spending habits, year, insurer, rainy day, property

First ever 25-yr fixed-rate mortgage

A new mortgage has been launched that could help first-time buyers get onto the property ladder.

Nationwide Building Society is offering a 25-year fixed-rate mortgage which will see buyers protected from future interest rate rises.

The firm has announced that the mortgage comes with a 5.49 per cent fixed interest rate and borrowers can opt out of the mortgage after ten years without having to pay a penalty fee.

Nationwide is promoting the new deal to everyone but first-time buyers are likely to see the biggest benefits.

“At Nationwide we are totally committed to our members because we have no shareholders to please,” commented Stuart Bernau, executive director at Nationwide.

“Our new 25-year fixed-rate mortgage is a clear demonstration of this. It not only offers long-term good value to borrowers looking for the security of fixed payments but also the flexibility of a ten-year deal.

“This is the latest in a series of initiatives that have been designed to complement our existing mortgage product range,” he added.

The new mortgage has been welcomed by many people although some argue that better deals are still available, with many shorter-term loans offering better rates.

If you are considering getting a mortgage make sure you seriously consider which deal is best for you.

Tags: shareholders, new deal, Everyone, Interest-only loan, rate

February increases saving mood

We all begin February with a good financial attitude, a desire to carry out sensible banking and a mood to save.

That is according to Legal & General which has published its Money Mood Survey for 2007.

In it, the firm tries to gauge the mood of the nation when it comes to saving and 2007 has proved to be the third year of growth.

According to Legal & General, 64 per cent of British adults were in the mood to save at the end of February.

This signals a rise of eight per cent compared to the same period in 2005. In addition, the mood to spend has fallen.

The study claims that 2007 saw the lowest mood to spend in February figures ever, with just 24 per cent of adults wanting to splash the cash.

“These latest figures show the Money Mood of the nation is firmly in save mode as we enter the Isa market this year,” remarked Claire Stacey, director of Legal & General.

“Money Mood also found that the percentage of households who said they have money to spend after paying bills and debt payments has not changed over the three years.

“That’s good news as it shows that the majority of households (58 per cent) are in a position to save rather than struggling to make ends meet,” she added.

This year’s Isa deadline is April 5th so if you are considering saving your money in a high-interest account you had better hurry.

Tags: sensible banking, growth, firm, fallen.The study, year

Summertime brings garden danger

We are being warned to be extra vigilant this summer as thieves look to strike in our gardens.

Halifax Home Insurance says that incidents of garden theft increase dramatically between March and August every year as people begin spending more time outside.

With the clocks set to go forward on Sunday (March 25th), Britain is officially entering summertime and that inevitably means we will begin taking out our patio furniture.

The warning from the insurance firm however, is that we must all take precautions to keep out garden furniture safe and should be covered against theft.

“Homeowners can forget to pay as much attention to security outside the house as they do inside,” said Vicky Emmott, senior manager of underwriting at Halifax Home Insurance.

“With many people realising how much value they can add to their property by improving their gardens, there are now rich pickings for thieves, and now is the time to take steps to avoid becoming the next.”

According to the insurer, the average claim for garden theft is around £400, while those living in Stoke-on-Trent are the most at risk.

Doncaster and Southampton follow closely behind, with Halifax revealing that tools, barbecues, garden furniture and bikes are the most popular items to be taken.

Homeowners are advised to lock all valuable garden items away when they are not in use, while gates should remain locked when you are not sitting in the garden.

Tags: Summertime brings garden, March, Britain, home, year, theft, Insurance, finance

Cold snap may cause chaos

If you have already put away your winter coat for the year you may find yourself caught short as the Met Office warns that a cold snap is fast approaching.

Freezing temperatures, wind and snow are expected and, aside from having to get our coats out again, we are being warned that our homes may suffer with the weather.

Halifax is warning that we may suffer damage to our homes as the temperature changes, particularly with burst water pipes causing problems.

The cold can lead to water inside exposed pipes freezing and expanding, leading to cracks which will leak water once the ice thaws.

“A sudden unseasonal drop in temperature can wreak havoc on people’s homes and gardens if they are unprepared for it,” warned Vicky Emmott from Halifax Home Insurance.

“Water from a burst pipe in a loft space can very quickly cause damage to plaster ceilings, walls, kitchen units, electrical wiring and decoration.”

We are being advised to get a home insurance policy so that we are covered in the event of a disaster and Ms Emmott also has some handy tips to prevent the worst happening in the first place.

She says that we should insulate any exposed pipes, ensure loft insulation is placed above water tanks and leave the loft open if going away.

Tags: vicky, weather, halifax, people's homes, Physics, year, place, space

Why Are Female Car Insurance Quotes Cheaper Than Men?

As every man likes to remind his woman, women cannot drive as well as men can. Call up a UK insurance company, or get a UK car insurance quote online, however, and the cost of the car insurance premium for exactly the same car is likely going to be cheaper for the woman than the man. So, if woman cannot drive as well as men, how can that be so? Read more

Tags: UK car insurance, driving drunk, Insurance, cheaper car insurance, year, traffic, female car insurance, driving ban

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, year, percentage, British Insurers, Impact, industry results, economics, room

Nationwide is fined

The Nationwide Building Society has received a huge fine after security flaws at the firm were exposed.

A laptop, belonging to a Nationwide employee, was stolen last year, potentially exposing around eleven million customers’ details.

The Financial Services Authority (FSA) says that the bank did not act quickly enough, not launching an investigation until three weeks after the laptop was taken.

The firm even allowed the employee to go away on holiday without asking what information was contained on the hard drive.

In response, the FSA has fined Nationwide for £980,000, even though no money was lost by any customer as a result of the theft.

“We have extensive security procedures in place, but in this isolated incident our systems of control were found wanting,” said Philip Williamson, Nationwide’s chief executive.

“We have made changes to fill the gap and improve our procedures further.”

Both the police and the FSA have said that they believe the laptop was stolen purely for computing reasons and the thieves were probably unaware of the information that it contained.

We can at least ensure that we do our bit to ensure we are banking safely by shredding any unwanted documents which have our details on them.

Tags: exposed.A laptop, fine, holiday, executive, hard drive, year, Gap, money

Northern Rock revises Together Mortgage

In response to rate changes at rival BM Solutions, Northern Rock revamped its Together range of mortgages yesterday by cutting rates across the entire range.

In addition, it has increased the help with costs option to £1,000, added two new short-term fixed rate mortgages and cut variable mortgage rates.

The marketing director of Northern Rock, Anth Mooney, said: “Increasing help with costs to £1,000 on our Together range means that customers can now use help with costs to cover their product fee thereby helping them to offset fee costs.

“Alternatively, help with costs could be used to help offset other costs associated with moving home such as stamp duty, legal fees or home improvements.”

BM Solutions altered rates across its Mortgage Plus range on January 31st. The range had been released last year to rival Northern Rock’s popular Together Mortgage.

Both lenders’ products combine a secured mortgage and unsecured loan and are aimed at first-time buyers.

Tags: year, GBP, Anth, Solutions altered rates, Unsecured loan, Together range, mortgage

ID theft warnings ignored

Too many Britons are still bypassing advice on how to protect themselves against identity theft, credit reference agency Callcredit has warned.

A third of Britons continue to throw away documents such as bank statements and receipts, which contain vital personal information, without shredding them first, a study from the Information Commissioner’s Office found this week.

Meanwhile, as many as a quarter of people would be oblivious if they were targeted by identity fraudsters – since they do not check their bank statements.

Customers should work these small but important habits into their financial routine, stressed Callcredit’s director of industry relations Melanie Mitchley: “Personal data is the lifeblood of identity thieves and they are gorging themselves on people’s complacency.”

“Remembering to destroy personal documents such as bills and statements before throwing them away would go a long way to starving ID fraudsters of opportunities,” she added.

Amid growing concerns about hi-tech online identity fraud, it’s important to keep your PC or laptop updated with anti-virus and firewall software to exclude hackers.

According to the UK fraud protection service, CIFAS, the number of victims of identity impersonation rose 19.91 per cent last year compared to 2005 levels.

Tags: credit card fraud, callcredit, thieves, identity theft, theft, director, Personal computer, year

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