26/06/2008 by Dave.

Nearly half of people in the UK are worried about falling into debt over the next year, new research has found.

According to a survey of 2,000 adults by YouGov, 46 per cent stated they are concerned they may not be able to make ends meet due to a rise in general living costs.

The research found women are the most worried about falling into debt, with 50 per cent saying they are concerned about falling into financial difficulty, while 57 per cent of men and women in the 35 to 44-years-old category stated they were anxious about money.

Owen Roberts from Creditcall, which commissioned the study, said rising costs of food and fuel are having a major impact on people’s personal finances.

“It appears that people are most concerned about short-term survival in light of spiralling costs, and many can’t see the situation improving over the coming 12 months,” he said.

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24/06/2008 by Dave.

The FSA is offering to help struggling home owners with rising mortgage costs via an online advice and information system.

The FSA will offer tips about how to manage payments and how to avoid getting into arrears. The FSA are also providing a mortgage calculator showing what monthly payments would look like with fluctuating interest rates.

With consumers facing gruelling times juggling their finances and interest rates are expected to rise as the Bank of England struggle to control inflation due to the ever-rising price of oil and food.

The 1.4 million people coming off fixed-rate mortgages this year they will now face the difficulty of finding competitive deals and certainly higher mortgage rates, which will undoubtedly heighten the UK debt problem.

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19/06/2008 by Dave.

The “number one priority” for people who face having their homes repossessed is to seek advice from a qualified professional, an industry figure has claimed.

James Elliot, a coordinator at financial inclusion network Transact, believes consumers at risk from repossession must ensure they have adequate legal representation and consult with an advisor as to what their best course of action is.

He pointed out there are several avenues open to those who face losing their home, with many advice lines with qualified debt specialists available to help those who require it.

“For those going through repossession, you must get advice and get someone to represent you if you are facing a repossession hearing. This really can make all the difference. Don’t put your head in the sand,” he said.

The Council of Mortgage Lenders recently predicted up to 45,000 homes could be repossessed this year, which equates to around one in 300 mortgages

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17/06/2008 by Dave.

More than one in four Britons feel their finances are out of control while around eight per cent regularly spend more than they earn, new research has found.

A survey by YouGov, released by GE Money, also found nearly 40 per cent of consumers have no money left at the end of each pay cycle, while more than a third are making an effort to change their spending habits in a bid to reduce outgoings.

Meanwhile, more than one-third of people claim to be debt free while nearly half of the respondents say they save between £1 and £500 from each pay packet.

A spokesperson from GE Money claims Brits must keep a constant eye on their finances so they know just how much they owe.

“With the cost of living increasing this is no time to relax; it is important that people take stock and ensure they know exactly what they owe and when,” the representative said.

YouGov is a market research and consulting agency which champions the use of the internet and information technology in collaborating data.

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12/06/2008 by Dave.

New research has found one in ten people in the UK are unaware as to how high their level of personal debt is.

According to research by CreditExpert.co.uk, a quarter of people can accurately state how much they owe on a loan while only one in five admit to financial planning once every six months.

In addition, the survey found just over a third of respondents did not know how much the annual percentage rate (APR) on their borrowings is and this figure rises to 48 per cent when it comes to credit cards.

Consumers between 18 and 34-years-old were found to be the worst at managing their finances, with almost a quarter admitting claiming they fail to control their monetary situation.

Jim Hodgkins, managing director for the site, claims the results provide cause for concern and urged people to monitor their finances better.

“This research provides a worrying insight into people’s perceptions of their finances. It is clear that many of us are not as familiar with our finances as we believe,” he said.

CreditExperian.co.uk is an online credit monitoring and identity fraud protection service

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10/06/2008 by Dave.

The Office of Fair Trading (OFT) is warning consumers about responding to unsolicited mailings which suggest they cancel IVA agreements and seek alternative forms of debt management.

According to the industry watchdog, several of these mailings suggest bankruptcy may be a better option and they may have been mis-sold the IVA.

The OFT believes companies are accessing people’s personal details from the public register listing consumers with IVAs and targeting the most vulnerable, which the watchdog claims is a breach of its debt management guidelines.

Ray Watson, director for consumer credit at the OFT, said the body will tackle companies engaging in unethical practices and urged businesses not to exploit those with financial problems.

“We expect any advice and/or information given to debtors to be in their best interests and it should include a full explanation of the implications of offers or advice,” Mr Watson stated.

The OFT aims to promote and protect the interests of consumers in the UK by monitoring the markets.

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06/06/2008 by Dave.

The Council of Mortgage Lenders (CML) has set out a plan through which it aims to prevent a glut of repossessions this year.

In a letter to Gordon Brown, the CML said that its members had committed to a series of new measures through which home seizures can be minimized.

These include providing homeowners who are struggling to pay their mortgages with relevant information regarding the process through which arrears management works.

CML members have also pledged to employ pre-action protocol, which will describe the stages creditors must have passed through prior to taking an arrears case to court.

Finally they have promised to take a more proactive role by contacting borrowers towards the end of the fixed term of their loan in order to warn them of the imminent payment shock.

Commenting on developments, Malcolm Hurlston, chairman of debt charity the Consumer Credit Counselling Service, told ITV.com: “A greater readiness to find new ways of helping people whose mortgages are under water is needed, as well as a budget for a promotional campaign to direct people, good and early, to the best sources of advice.”

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04/06/2008 by Dave.

Homeowners are opting to take breaks from paying their mortgages in increasing numbers as the rising cost of day to day living bites.

Nationwide has reported an increase in people taking a mortgage repayment holidays in recent months, with the lender attributing the trend to soaring inflation which has swelled homeowners’ outgoings.

Meanwhile Bradford & Bingley (B&B) has confirmed that that it had experienced a rise in inquiries about payment holidays, while the Yorkshire Building Society has announced that it has also noted more interest from its customers in flexible payment options.

A spokesman for B&B told the Times: “We expect to see that translated into people restructuring their finances, either through taking a payment holiday or extending the term of their mortgage.”

The newspaper calculates that customers with a £150,000 25-year mortgage at 5.5 per cent who choose an interest-only would slash repayments by nearly £250 per month.

Meanwhile, opting to extend the term of your loan by five years would cut monthly bills by £70

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02/06/2008 by Dave.

Large numbers of homeowners have slipped into negative equity as a result of months of consecutive falls in house prices, an investment bank has warned.

According to Citigroup, since autumn UK house prices have slumped by seven per cent.

As a result, the firm calculates that 250,000 mortgage holders now face a situation whereby the value of their home is lower than what they owe.

Citigroup’s chief UK economist, Michael Saunders warned that the situation is likely to worsen in months to come, with house prices set to fall by 15 per cent by the end of 2009.

This will leave a million homeowners facing negative equity he said.

Mr Saunders added: “The signs are that the economy’s slowing very sharply, but with inflation shifting up the Bank of England cannot cut rates.

“The economy’s being hit by these two big shocks: you’ve got the credit crunch and the housing crash; and you’ve got this shock from oil prices.”

By way of comparison, during the housing slump of the early 1990s, around 1.8 million people were in negative equity.

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