by News Team on April 20th, 2008
First-time buyers (FTBs) across Britain are struggling to cope with their debt management pressures more than they ever have before, it has been claimed.
According to a report from Shelter, the average monthly mortgage payment rate has risen at more than three times the pace of typical wages among British households, which has left millions of consumers in dire straights.
To compound the already desperate debt management problems of many people, money lenders have increased their mortgage rates even as house prices begin to fall, the homelessness charity has maintained.
“Buying a home has now become a distant, unaffordable dream for millions of first-time buyers, while thousands of others are facing repossession and homelessness,” said chief executive of Shelter Adam Sampson.
The average British household now pays out around £3,700 on an annual basis to service the interest on their debts, according to figures compiled by Credit Action.
Posted in Creditor Behaviour, Debt and Young People, Houses and Mortgages, Personal Debt | No Comments »
by News Team on April 19th, 2008
Home loan borrowing activity in the UK is set to slow over the course of 2008, according to the latest assessment of the Council of Mortgage Lenders (CML).
The council has revealed that the scale of lending among its members fell by around eight per cent in the first quarter of this year compared with the same period in 2007.
For many people, the prospect of a mortgage-related debt management burden worth tens of thousands of pounds is proving to be enough to deter them from entering the housing market in the current climate.
With this in mind, the CML has called on the Bank of England to cut its base rate of interest to encourage more borrowing and lending activity in the sector.
Michael Coogan, the CML’s director general, said: “We await the eagerly anticipated announcement of further action by the Bank of England to respond to these rapidly worsening market conditions.”
A number of leading British money lenders have added to their customers’ difficulties in becoming debt free recently by upping their interest rates despite a base rate cut earlier this month.
Posted in Creditor Behaviour, Debt Management, Houses and Mortgages, Personal Debt | No Comments »
by News Team on April 18th, 2008
Average British consumers are the ones paying the price for the poor management of the economy by the current government, it has been claimed.
Phillip Hammond, a Treasury spokesperson for the Conservatives, is convinced that the Labour Party and particularly prime minister Gordon Brown are to blame for the debt management problems afflicting millions of ordinary Britons in the wake of the credit crunch.
The past decade saw UK consumers borrow money at an unprecedented rate and for many people the current economic squeeze is resulting in financial disaster, Mr Hammond suggested.
“Gordon Brown’s decade at the Treasury was characterised by years of easy credit, fuelling a house price boom and a mountain of debt,” he said.
“Now the chickens are coming home to roost.”
Mr Hammond’s comments came soon after the Council of Mortgage Lenders described the UK’s housing market as “rapidly worsening”.
Posted in Debt Management, Personal Debt | No Comments »
by News Team on April 18th, 2008
Homeowners around the UK are being hit by “staggering” mortgage fees, it has been claimed.
According to research by uSwitch.com, the average amount charged in fees by lenders is around £1,000 and in many cases this figure doubles when added to the overall mortgage debt.
Some homeowners have found themselves facing fees initially worth more than £2,000 that rise to £4,000 when repaid over the length of the loan, the latest figures suggest.
For many the accumulation of these fees has made it more difficult to become debt free and almost 800,000 homeowners have been hit with these charges without realising.
“Adding fees to a mortgage means that you will be spreading the amount over many years and paying interest for the pleasure of doing so – this is an extremely expensive option and should always be seen as a last resort,” said Ann Robinson, director of consumer policy at uSwitch.com.
Figures released by Halifax last week showed that the average house price in the UK fell by around 2.5 per cent during March.
Posted in Creditor Behaviour, Debt Management, Houses and Mortgages | No Comments »
by News Team on April 18th, 2008
The lack of free balance transfer offers available to credit card users in the UK is having a knock-on effect on the overall debt management efforts of many struggling consumers, according to one expert.
Beccy Boden-Wilks from National Debtline has suggested that British consumers are finding it more difficult to clear their credit card debt and as a result are seeing their finances squeezed more generally.
Ultimately, these issues are leading some people to miss their mortgage repayment deadlines and to borrow money at higher rates of interest than they have been used to, according to Ms Boden-Wilks.
“One of the major effects of the credit crunch is that people can’t manage their large amount of debt as cheaply as they could before; this is having a knock-on effect,” she explained.
A report from Sainsbury’s Finance recently suggested that there will be close to £1.1 billion worth of credit card debt transferred from one deal to another over the course of this year.
Posted in Creditor Behaviour, Debt Management, Personal Debt | No Comments »
by News Team on April 18th, 2008
Millions of British consumers are ignoring the risks to their finances and taking on debt in order to boost their own image, according to a new report.
A study carried out on behalf of CreditExpert found that almost a third of people have overspent in an effort to appear more affluent and for many this has led to serious debt management problems.
Items of clothing, jewellery, shoes and – particularly in the case of British men – cars are proving to be an irresistible attraction for many people despite the financial risks involved in buying them.
“The desire to keep up with friends isn’t new and there is always a temptation to use credit to do so,” said Jim Hodgkins, managing director of CreditExpert.
“But using credit to fund a lifestyle you can’t really afford can lead to huge financial problems.”
Meanwhile, MoneyExpert reported recently that the cost of spending via
credit card debt has increased over the past six months despite cuts in the Bank of England’s base rate of interest.
Posted in Debt Management, Debt and Young People, Personal Debt | No Comments »
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