Past Articles for December, 2008

Mortgage prices have been reduced as part of a new year sale by Leeds Building Society, the lender has announced.

The cost of a number of its homeowner loans - including fixed-rate and first-time buyer options - have been cut, with rates for three-year fixed-rate deals now starting at 4.75 per cent for a 65 per cent loan-to-value (LTV) deal.

Those looking for a product with 85 per cent LTV can expect to pay 5.99 per cent interest, with all of the lender’s thee-year fixed-rate options carrying a completion fee of £999.

Leeds Building Society’s Karen Wint explained the new mortgages will give customers “peace of mind and flexibility”.

“The new year is a great time to sort out your finances and … I would urge customers to act quickly to secure a great deal,” she remarked.

Those looking to switch their mortgage as part of a debt management plan may wish to consider the new finance packages.

NatWest and the Royal Bank of Scotland have also introduced new fixed-rate mortgages, with interest rates being cut by up to 0.4 per cent.

By Tom Musk

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A growing number of people are telephoning a government-funded advice line for debt advice, new figures have revealed.

The Department for Business Enterprise and Regulatory Reform has announced a 40 per cent increase in the amount of people contracting the National Debtline over the last year, with the charity now taking approximately 23,000 calls per month.

Calls to Business Debtline, a service set up specifically to help firms that have fallen into financial difficulty, have doubled during between autumn 2007 and autumn 2008, the figures also showed.

Consumer affairs minister Gareth Thomas noted that it is “imperative” those struggling with the finances get help “as soon as possible”.

“There are a wide range of organisations [that] provide expert advice and can really make a difference when it comes to resolving debt problems,” he added.

The figures support recent statistics from Citizens Advice, which revealed a 125 per cent increase in the number of people enquiring about redundancy help since April of this year.

By Tom Musk

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Consumers looking to save money in the new year should use a credit card with zero per cent interest, it has been suggested.

According to Halifax, switching to such a card can help cut the cost of shopping, as consumers using a product with a high annual percentage rate are likely to be paying more than necessary for their goods.

“Too few of us include banking products in our bargain hunting,” managing director of Halifax Financial Services Karen Crowshaw remarked, adding that the current economic climate means it has “never been more important” to find the best deals on financial products.

Customers looking to gain greater control over their finances and cut down their credit card debt in 2009 may wish to follow Ms Crowshaw’s advice and switch to a card offering zero per cent interest.

However, interest rates on credit cards are unlikely to fall in the coming year despite recent base rate cuts, Peter Harrison of moneysupermarket has predicted.

By Tom Musk

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Sainsbury’s Finance has announced a cut in the rate of its personal loans for online customers.

The lender is reducing the typical annual percentage rate from 8.9 per cent to 8.2 per cent for loans ranging from £7,000 to £15,000.

Those who are considering borrowing such an amount - perhaps to help carry out debt consolidation - will be able to receive the money within 24 hours and will not have to pay any set up fees.

Head of loans at Sainsbury’s finance Steven Baillie said that the lender is “committed” to providing “great products” to consumers.

“[We] are delighted to be able to offer this rate cut at a time when our customers are starting to think about the new year ahead,” he added.

Research by uSwitch.com recently revealed that the cost of taking out an unsecured loan is increasing, with the average interest rate now standing at 9.44 per cent.

By Tom Musk

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Halifax has issued advice to consumers looking to make purchases in the January sales, after publishing figures revealing more shoppers will be looking for a bargain in the new year compared to 2008 data.

According to the lender, 48 per cent of customers will be looking to buy in the sales I January 2009, an increase of nine per cent on those who visited sales in January of this year.

And one in four (26 per cent) are expecting to spend more than the average £112.40 they paid out last year, prompting Halifax to advise shoppers to plan ahead.

Setting a budget and drawing up a list of items you need can help avoid unnecessary expenditure, the lender stated - tips that those looking to maintain their debt management while shopping may wish to adopt.

The research follows another study by Halifax, which found that the majority of shoppers purchasing Christmas gifts are doing so with cash rather than loans or credit cards.

By Tom Musk

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Children in the east Midlands are achieving the highest savings balances in relation to pocket money received, new figures have revealed.

Research from Halifax found those living in this area have an average of £1,038 in savings, despite receiving £231.92 in pocket money every year.

The highest savings balances belong to children living in Greater London, who have an average of £1,379 in the bank, while those living in Scotland have only £853 saved - despite receiving £426.40 a year in pocket money.

Head of savings at Halifax Ken Stannard described the figures as “heartening”.

“It is important to encourage a good savings habit at an early age and explain the need of financial planning for the future,” he remarked, advice that parents looking to encourage their children to remain debt free may wish to pass on.

Alliance & Leicester recently published figures indicating that the credit crunch has resulted in many people cutting back on their spending and beginning to save, with the younger generation showing a keenness to reduce their outgoings.

By Tom Musk

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November saw a £2.9 billion increase in net mortgage lending, new figures have revealed.

The data, compiled by the British Bankers’ Association (BBA), indicated lower lending levels than for the previous month - where lending rose by £3.3 billion - and a fall compared to the six-month average of £3.5 billion.

David Dooks, statistics director for the BBA, explained that high-street banks are providing two-thirds of the homeowner loans currently on the market.

“The 1.5 per cent November reduction in [the] Bank Rate caused lenders to re-assess product ranges and borrowers to re-consider future borrowing costs, so consequently there was another drop in market activity,” he remarked, adding that the public’s concern regarding their personal finances is also limiting activity in the housing sector.

Homeowners looking to switch their mortgage as part of a debt management plan may be attracted to new offerings from NatWest and the Royal Bank of Scotland, which carry rate reductions of up to 0.4 per cent.

By Tom Musk

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Credit card interest rates are likely to remain the same over the coming year, it has been predicted.

Peter Harrison, head of credit cards at price comparison website moneysupermarket, stated that rates will remain unchanged in 2009, despite the recent reduction in the base rate by the Bank of England.

And he also forecasted an increase in balance transfer fees, noting that he was “curious” to see where credit card firms will find the extra money to cover the cost of implementing the new code of practice barring them from selling personal payment insurance alongside credit cards.

“It’ll be very interesting to see how credit card providers will implement the new code … and whether they will still increase rates,” he remarked.

The predicted lack of a rates cut may be bad news for those struggling with credit card debt and hoping to get debt free in 2009.

MoneyExpert recently noted that many credit card customers are struggling to pay off their debts from last Christmas as they enter the current festive season.

By Tom Musk

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New standard fixed-rate mortgages have been introduced by NatWest and the Royal Bank of Scotland (RBS), it has been announced.

The new deals feature a reduction in rates by up to 0.4 per cent, with customers who take out a two-year fixed loan at 60 per cent loan-to-value (LTV) with a £799 fee able to benefit from the full cut.

Those who opt for a two-year deal at 75 per cent LTV with a £999 fee will see a 0.15 per cent rate reduction, while the lenders have also introduced a new, three-year equivalent which carries an interest rate of 4.79 per cent.

“We believe this new attractive range of fixed-rate deals gives our customers a great opportunity to secure lower rates for two to three years,” director of branch mortgages Andy Fell said.

Those looking for a new mortgage as part of a
debt management plan may wish to note that Abbey recently announced cuts of up to 0.6 per cent across its range of fixed-rate options.

By Tom Musk

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Many Britons are having to pay unexpected or extra charges at a time when they are looking to cut down on their bills, it has been claimed.

According to moneysupermarket.com, over 4.5 million households are paying such fees for broadband and mobile phone services, costing consumers an extra £36 per year on average.

The research found that paper billing and non-direct debit payments were the most common items customers were charged for, with some also footing the bill for late payments and installation charges.

“Although we’ve seen telecom bills fall in the past year, providers are still clawing back millions with unnecessary charges,” James Parker of the price comparison website stated, calling for Ofcom to investigate ways to protect consumers from these charges.

And he also advised customers to check their contracts thoroughly so that they are aware of any extra costs, advice that those following a debt management plan may wish to consider.

Halifax recently urged customers who are looking to improve their debt management to seek advice from a finance professional rather than friends and family.

By Tom Musk

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