30/03/2007 by Dave.

New figures from property website, Propertyfinder, show the cost of moving home closing in on 10K. In fact, home moving costs have more than tripled to just over £9,400 over the past decade. Much of the impetus has come from higher Stamp Duty and estate agents’ fees. And, depressingly, the figures don’t include fees applied by lenders and surveyors.

Estate agents’ charges - typically at around £3,000 - have risen broadly in line with house prices. But Stamp Duty has seen a near ten fold increase to £5,000. Legal fees typically come in at £1,000 while removal costs are now £450 on average.

Inflated stamp duty costs should come as no great surprise, given that in 1996 there was a standard 1% fee on properties valued at 60K+. Nowadays, additional bands see £250K+ properties levied at 3% and 500K+ properties at 4%. And with the average price of a property now at 200K, home purchasers are witnessing ever higher financial outlays.

A favoured route of many is to remortgage or take a secured loan to extend their existing property, bypassing the high costs associated with moving home.

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29/03/2007 by Dave.

Almost three million credit card applications have been turned down in the past six months, as the rising tide of bad debt hits banks, a survey shows.Some 2.8 million people have been refused a credit card in the last six months — equal to around 15,555 rejections a day — according to research by price comparison service MoneyExpert.com.

Bad debt problems have been mounting since last year as more and more people have reneged on repayments on loans and credit cards. Britain’s largest card firm Barclaycard lost 1.5 billion pounds in bad debts during 2006.MoneyExpert said the poll of 2,291 adults suggests that such losses had led banks and other credit card firms to tighten rules on new applications.

People aged between 25 and 34 are the most likely to have card applications turned down: 11 percent of them have been refused credit in the past six months, compared to 8 percent of those aged 18-24 and 3 percent of the 55-plus age group.

If you find yourself turned down for a credit card and need to consolidate your debt a secured loan is a viable alternative.

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27/03/2007 by Dave.

The year 2006 was a record-breaker for savers, figures show.Consumers stashed away 136.7 billion pounds last year — up 22.3 percent or 24.9 billion pounds on the previous year, according to statistics from Unbiased.co.uk, a Web site that promotes the benefits of independent financial advice.

That was the largest annual figure since Unbiased started its “Savings Brake” research in 2001 and compares to a low of just 96.2 billion pounds in that year.

Consumers saved 39 billion pounds in the fourth quarter of 2006 alone, up 16 percent on the previous quarter, and the highest quarterly figure since the survey began.However, the index — which reveals the ratio of how much consumers are borrowing, not including mortgage debt, compared to how much they are saving — shows people are still borrowing 40 pence for every pound saved.

That was down from 52 pence in the final quarter of 2005, but David Elms, chief executive of Unbiased.co.uk, said: “The news that UK consumers are breaking records for saving is very encouraging, but the fact remains that the good work is wasted because debt continues to rise.

“All the conscientious effort being made on the savings side is being undone by continued increasing usage of credit cards, loans and overdrafts.”

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21/03/2007 by Dave.

Consumers who take cash out on their credit card are being charged excessively high rates of interest, according to a new uSwitch report.The average credit card user takes out £809 a year in cash and is being charged interest at the equivalent of over 27 per cent

The average cash interest rate on credit cards has increased from around 20 per cent two years ago, in part because of a charge being levied every time you take even just £10 out of a cash point.

“People who use a credit card to withdraw cash may already be struggling under the burden of debt, and are having to resort to this method of borrowing to make ends meet. They can ill afford to pay the exorbitant rates of interest that most lenders are now charging them,” said Nick White from uSwitch.

“While we accept that credit card providers have to make money, and that cash withdrawals carry a higher risk of people getting into bad debt, it is indefensible for companies to penalise their most vulnerable customers,” he argued.

Credit cards are one of the most expensive ways of borrowing, so consolidating your debt into a secured loan can help cut your outgoings and ease financial stresses.

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19/03/2007 by Dave.

At last! House prices are no longer the topic of choice at dinner parties. But it seems price of your property still has bearing on the subject of choice. Council Tax is now the most talked about financial topic, with almost two thirds of people (65%) saying this is the most discussed issue with family and friends, according to the latest findings from Unbiased.co.uk.

The latest TaxAction report, which focuses on the UK’s tax wastage, sees Council Tax topping the financial discussion bill, closely followed by rising house prices and inheritance tax.

The survey comes as the subject is set to make headlines again with the delayed review of local government funding by Sir Michael Lyons expected to propose a new, top-rate council tax band. As well as a new top tier (or even two according to some reports), widespread increases in tax levels are expected.

David Elms, Chief Executive of Unbiased.co.uk comments, “It’s no surprise that Council Tax is dominating discussion across the UK as people mentally prepare themselves for the probable increase of re-banding costs.

The Lyons review is being published alongside Budget 2007 later this week. It is expected to call for a new “top rung” council tax band for houses worth more than £1 million. More than 6,000 homes were sold for £1 million or more in England last year, according to Land Registry figures.

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16/03/2007 by Dave.

Credit card companies are continuing to find new ways to make extra money out of their customers, according to a new report.Consumer groups have frequently complained about certain practices by credit card companies, including hidden fees and excessively high interest rates, but the new Moneyfacts report is more worrying.The latest money-earner involves Lloyds TSB requiring balance transfer customers to make a purchase of more than £100 in the first three months to protect their zero per cent introductory deal.On top of this, almost all companies now charge an upfront fee for moving a balance over – and some have no upper limit on this, potentially putting you seriously out of pocket if you have a lot of debt to consolidate.“With fees and rates increasing and providers becoming more ‘creative’ with their terms and conditions, it is more and more important for consumers fully to understand any credit card deal before signing up,” said Michelle Slade from Moneyfacts.

In contrast, taking out a secured loan can help you simplify your personal finances.

Offering both a lower interest rate than credit cards and the ability to arrange debt consolidation of any credit cards, store cards or overdrafts, a secured loan can help cut your debts considerably

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14/03/2007 by Dave.

With the price of a packet of fags now around £5.00 - adding up to £1,825 a year if you smoke 20 a day - it really is money up in smoke. Thats a nice tidy sum that could give you a marvellous boost for your savings. If you saved all that away have you thought what this could achieve in only few years if it was placed in a high interest savings account, a mini cash individual savings account (ISA) or an investment or pension fund?

Giving up smoking isn’t easy but when you think that 80% of the price you pay for your habit goes in taxes putting £12 billion a year into the taxman’s pocket, its enough to make you want to give up. From 1 July, England will follow Scotland, Wales and Northern Ireland and smoking will be banned in all enclosed public places such as offices, bar and restaurants, which will make it easier to give up - that is if you don’t break the habit on 14 March - No Smoking Day.

Marks & Spencer Money said that around half of England’s 12.4 million smokers are expected to try to give up once the ban comes into place and that smokers could save on average of £125 a month.

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13/03/2007 by Dave.

The threat of higher interest rates led a record number of first time buyers opting for a fixed rate mortgage loan, according the Council of Mortgage Lenders (CML). In fact, 85% of first time buyers chose a fixed rate deal in January - the highest figure on record - and just over 70% of home movers also decided on a fixed rate product.

CML Director General Michael Coogan said, “Increasing numbers of people - especially first time buyers - are opting for a fixed rate mortgage. Each month it seems that the prospect of another interest rate rise is balanced on a knife edge. More and more borrowers are protecting themselves against this risk and choosing the certainty of fixing their monthly mortgage payments, which allows them to plan ahead with confidence.”

The CML believes it is encouraging that increasing numbers of first time buyers are locking into the payment certainty a fixed rate mortgage provides, as they are the group that are more financially stretched and may suffer most if interest rates go up. Overall, fixed rate mortgages accounted for 72% of all new loans in January - the highest proportion since January 2006 - up from 69% in December.

Despite recent base rate increases, the pricing of fixed rate loans continued to remain attractive compared to variable rate deals. The average interest rate of a fixed rate loan in January was 5.27%, up from 5.23% in December, compared to the average interest rate of a discounted variable-rate product which reached 5.54% up from 5.36% in December.

The CML survey also shows an 11% seasonal fall in the number of loans for house purchase and remortgaging taken out in January - 162,300 loans, down from 182,300 in December. But, this was still 6% higher than the 153,600 loans taken out in January 2006.

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12/03/2007 by Dave.

With ‘rogue petrol’ coming off some forecourts and causing cars to splutter and stop, motorists are well advised to think about getting car breakdown cover. This market used to be dominated by big names such as the AA and RAC but now drivers have a choice from dozens of, often much cheaper, suppliers. However the old adage ‘you get what you pay for’ can prove true when you look at the level of cover some providers offer.

New entrant rescuemycar.com offers breakdown cover from just £31 a year. However if you check the small print, the policy is littered with exclusions. The main one is that every call-out is subject to a £40 excess. So if you have to call out the company’s patrols just once in a year, the policy stops being a best buy and becomes very average. Call it out three or more times and it becomes the most expensive policy around. Rescuemycar.com also does not cover parts needed to fix your vehicle, running out of petrol or more than six call-outs each year.

Rival, First Call, offers roadside cover for £32 a year and charges a £40 fee if you call out a patrol to your home address. It also has limits on the number of call-outs per year and how far it will take your car to be fixed at a garage. Also the policy just covers one vehicle unlike services such as the AA which covers members travelling as passengers in other people’s cars.

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09/03/2007 by Dave.

New research by Halifax Estate Agents shows that over the last 5 and 10 years house price increases in the UK have been greatest for terraced houses. Based on Halifax’s own house price data, the results show that over the last ten years, for example, the average UK terraced house price has increased by 239%, closely followed by flats and maisonettes at 235%.

Over the last five years the trend is a little different; terraced properties have still recorded the biggest average house price increase across the UK at 113% but, the next biggest increase was seen by semi-detached houses at 95%. Flats and maisonettes recorded more modest growth at 87%.

Despite the strong growth in the price of terraced properties, detached houses still have the highest average price of all property types. The average price of a detached property in the UK is now £326,396, compared to £110,240 at the end of 1996.

In 1996 the average detached property would have been well under the inheritance tax threshold of £200,000 (In April 1997 this was increased to £215,000). Even with an increase in the IHT threshold in April this year (2007) to £300,000 the value of the average detached property will be well in excess of this. Currently, the average detached property in the UK (£326,396) is now also well in excess of the £250,000 (3%) stamp duty threshold.

Meanwhile, the average price of all property types is now above the £125,000 (1%) lower stamp duty threshold. In 1996 the lower stamp duty threshold was £60,000 - so both the average terraced property (£54,945) and flat and maisonette (£58,046) were below this.

At a regional level, the biggest house price increases in the UK have been seen in terraced houses in Northern Ireland, followed by flats and maisonettes in East Anglia - the average price of a terraced house in Northern Ireland having risen by 372% - flats and the average price of a maisonette in East Anglia having increased by 328%.

At the opposite extreme the average house price increase for a semi-detached property in Scotland was 129%, followed by detached properties and bungalows at 147%. However, the average price of a detached property in Scotland currently stands at £246,372 - well above the UK all property types average of £218,760.

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