May 2009 Archive
Posted on May 29th, 2009 in Debt.
There are many different ways in which people with debt management problems can deal with their issues.
Beccy Wilks, spokesperson for the Money Advice Trust, said it depends on the amount and type of debt a person has.
"It could be that someone is worried about not being able to pay a utility bill so may consider borrowing money to pay off the debt," she suggested.
However, in some cases it might not be necessary to take out a loan, Ms Wilks continued, as debt management experts are able to ascertain the best plan of action for individual needs.
Credit Action revealed earlier this month that total UK personal debt at the end of March stood at £1,459 billion, which has slowed further to 2.2 per cent in the past 12 months, equating to an increase of £28 billion.
Average household debt in the UK was said to be £9,280 (excluding mortgages), increasing to £21,580 if the average was based on the number of households who actually have some form of unsecured loan.
Posted on May 29th, 2009 in Debt.
It is no surprise that mortgage lending figures are at such a low rate, it has been said.
Peter O’Donovan, head of mortgages at Bestinvest, suggested it indicates that the property market is reaching the bottom.
"If people are starting to buy, there will be more interest and more people will be looking after the same property and therefore that price may start to increase," he stated.
The property market is not likely to return to the same levels as last year, Mr O’Donovan suggested, although there are perhaps some signs that confidence is beginning to return.
According to statistics from the Ministry for Justice, during the first quarter of this year 22,609 mortgage possession claims were issued on a seasonally-adjusted basis, 42 per cent lower than in the first quarter of 2008.
Furthermore, 17,054 mortgage possession orders were made on a seasonally-adjusted basis, 39 per cent lower than in the first three months of last year.
The statistics also reveal that 47 per cent of mortgage possession orders were suspended, broadly the same as in the first quarter of 2008.
Posted on May 29th, 2009 in Debt.
Consumers are erring on the side of caution when it comes to debt management, it has been said.
All parties involved with loan transactions are becoming more careful, revealed Adrian Coles, director-general of the Building Society Association (BSA), with consumers perhaps choosing to buy what they can afford.
"On the lending side clearly some loans were made by some institutions to people who can’t now repay them and those loans shouldn’t have been made," he continued.
Other considerations are said to include whether a person decides to remortgage or not and whether they can buy something on the spot with their savings or choose not to buy at all.
People may also opt to buy a cheaper version of the product they want, rather than face the debts associated with buying something they cannot afford, Mr Coles added.
According to the latest Trends in Lending report released by the Bank of England, net mortgage lending slowed to £1.6 billion in April, down from £2 billion in March.
The annual rate of lending growth fell further in March, with major UK lenders reporting that their net lending flows remained weak in April.
Posted on May 28th, 2009 in Debt.
Weak net mortgage lending figures are a reflection of problems experienced in previous months, it has been said.
Statistics director at the British Bankers Association (BBA) David Dooks revealed that they also depict the wider financial difficulties experienced by many people.
"Households’ uncertain financial circumstances not surprisingly continue to dictate consumer behaviour, both in the housing market and in generating only low demand for new personal loans," Mr Dooks continued.
The BBA figures also show that personal deposits have increased for the third month in a row, although the savings trend in bank accounts is still yet to recover.
Lending to financial firms has also seen a decrease, the statistics reveal.
The Council of Mortgage Lenders (CML) reported earlier this month that mortgage lending fell to an estimated £10.4 billion in April – down by nine per cent compared to March 2009.
Mortgage lending in March and April 2009 was down by 57 per cent compared to the same months in 2008, the CML suggested, with estimates for gross mortgage lending this year expected to total £145 billion.
Posted on May 28th, 2009 in Debt.
The housing market needs to be stimulated by mortgage lenders freeing up more money for their customers.
Steve Turner, head of communications at the Home Builders Federation, revealed that measures are already in place to help the situation, but that more needs to be done to push them through.
"The crux of the issue in terms of the housing market is getting banks lending again at sensible rates to people who want to buy homes," Mr Turner added.
He also made calls for more money to become available to home builders who are experiencing a lack of demand at the moment, leaving many development sites "mothballed" throughout the country.
PropertyLive.co.uk reported earlier this month that 65 per cent of non-homeowners believe they will never own a property.
In addition to this, the website discovered that five per cent believe they will have to wait more than five years to secure a mortgage.
The study also showed that ten per cent feel they will have secured a mortgage in one to two years’ time, while 14 per cent suggest it will take between two and five years.
