May 2008 Archive
Posted on May 30th, 2008 in Debt.
Despite the UK’s economic downturn, the desire to have a high-powered or good looking car is driving thousands of British consumers into debt, it has been revealed.
A report from information services firm Experian has shown that car purchases are the number one motivation for Britons to take on a loan and spend beyond their means.
Close to one in five men are willing to give themselves a debt management headache in order to buy the car they want and the same is true of almost ten per cent of women around the country.
The reason for this willingness to risk debt problems is attributed in part to the fact that a third of all British adults confess that they are influenced by how other people perceive them.
Kirk Fletcher, from Experian, said: "The credit crunch is having a significant impact on consumer confidence across the UK, yet this survey highlights the fact that the consumer’s desire for a car that projects the right image remains as strong as ever."
Last week, swiftcover reminded drivers that they can help themselves avoid money problems by accelerating and braking less often in their cars in order to conserve fuel.
Posted on May 30th, 2008 in Remortgage.
The average house price in the UK plunged by close to 2.5 per cent over the course of May, according to the latest figures compiled by Nationwide.
Millions of homeowners are experiencing serious debt management and money problems and the average property price has fallen by 4.4 per cent in the past 12 months.
First-time buyers and people looking to remortgage are finding it increasingly difficult to secure a good deal and the reduction of house prices has begun to accelerate, Nationwide reports.
Average house prices fell by £5,000 over the course of May, which represents the sharpest one month decline since the building society started recording relevant data 17 years ago.
"The pace of house price falls accelerated in May as more weak economic news added to the gathering momentum of negative sentiment about the housing market," said Nationwide’s chief economist Fionnula Earley.
Meanwhile, the Axa insurance firm warned that the money problems facing British homeowners could soon be worse than those experienced during the last property crisis in the early 1990s.
Posted on May 30th, 2008 in Loans.
There will be no reduction in the base rate of interest until August at the earliest, according to one expert.
Howard Archer, chief UK and European economist at Global Insight, is convinced that the inflationary pressures within the British economy will be enough to force the Bank of England to maintain the base rate for the next few months.
A cut in interest rates would be welcome for the millions of Britons experiencing debt problems but Mr Archer predicts that such a move will not be made soon.
However, the economic expert expects to see the base rate begin to move significantly as the year goes on and predicts that it will fall as low as four per cent at some point next year.
"It currently seems highly unlikely that the bank will be prepared to trim interest rates again until August at the very earliest," he said.
According to Credit Action, British borrowers pay out an average of around £3,765 each month to service the interest on their debt management burdens.
Posted on May 29th, 2008 in Debt.
A report from Egg has highlighted the extent of the financial squeeze currently being put on consumers and households around the UK.
Millions of Britons are suffering with money problems and the average individual needs around £1,077 in order to pay their household bills, buy food and meet their debt management demands on a monthly basis.
In addition, the financial services firm’s research found that around half of the UK’s workforce would not be able to support their families for more than four months if they became unemployed.
"As a rule of thumb, it has long been considered sensible for families to have cash savings of at least three months income, for any of life’s emergencies," said Tobias van der Meer, head of consumer banking and investments at Egg.
"However, our research highlights that far from being a precaution, these savings are a necessity."
Alliance & Leicester reported this week that the rising cost living in the UK has prompted thousands of borrowers to consolidate their debts in recent months.
Posted on May 29th, 2008 in Remortgage.
The mortgage market in the UK is becoming a lottery for people looking to secure a good deal on a home loan, it has been claimed.
According to Moneyfacts, mortgage deals are now typically available for only 11 days, which the company suggests leaves borrowers having to make borrowing decisions quickly and hope for the best.
The personal finance information firm also reports that the number of options available to British consumers has fallen dramatically over the past 12 months.
And this is viewed as particularly bad news for homeowners looking to avoid debt management disaster when they come to the end of their current fixed-rate mortgage arrangement.
"Until the current market readjustment is complete, the ability to time the mortgage market has become more of a lottery than an art, with the majority of today’s better deals expected to have disappeared by this time next week," a statement from Moneyfacts read.
The Council of Mortgage Lenders predicts that around 45,000 properties in the UK will be repossessed as a result of debt problems over the course of this year.
