UK Secured Loans Blog: July 2006

Monday, July 24, 2006

Plight of pensioners indicates it makes sense to clear debt before retirement

A recent survey by Prudential UK shows that 1.4 million pensioners are surviving on an income of £5,000 or less a year. This figure drops to just £3,092 once basic outgoings such as council tax, water and electricity bills have been paid. Retired people who rely on a state pension have just £4,381 a year to live on.

According to Prudential, pensioners are cutting down on everyday spending and are having to go without holidays, leisure activities and eating out. In order to continue living comfortably, some pensioners have resorted to continuing to work full or part time, to using assets and funds intended for family or friends and to borrowing money from the bank. However, over half of the British pensioner population are living on £15,000 or less per year.

Commenting on the survey, Angus Maciver, Prudential UK Director said “Its worrying to think that such a large number of pensioners in this country live on £5,000 or less a year. How many of us could truly say that we could manage on what works out to be just £8.49 a day?”

The figures from Prudential’s long established Retirement Index prove the importance of saving for the future. Angus Maciver commented ‘The earlier you start the more time you have got to save.’ It is also fair to say that the figures highlight the need to clear debt before reaching retirement age as with a reduced income, debts would be difficult to manage. People in their thirties and forties might wish to consider taking out a secured homeowner loan to consolidate debts while still earning, rather than allowing these to continue mounting up to retirement age. It is however important to remember that repaying borrowing over a longer term increases overall interest charges.

Nemo´s typical rate is 9.0% APR variable. A NEMO LOAN IS SECURED ON YOUR HOME. THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

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Thursday, July 20, 2006

Price rise could encourage home owner loans

Huge demand for property in London has driven the nationwide increase in housing prices, according to a new survey.

The Hometrack monthly national housing survey revealed a 2.9 per cent increase in the first half of 2006 with a 0.6 per figure of growth in June alone.

Richard Donnell, Director of Research at Hometrack, said: "Looking back over the first six months of the year there is a stark difference in performance between London and the rest of the country.

"While there is clear momentum in the market we believe that a modest cooling in the rate of growth is likely over the second half of the year."

And with these steady increases in property value, many property owners could consider taking out a home owner loan if they wished to invest further in their property.

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Wednesday, July 19, 2006

Spend now pay later lifestyle

Research conducted by market analysts Mintel in December 2005 suggests that the UK is gripped by a borrowing culture. Currently 21 million consumers have outstanding debts on credit cards and loans excluding mortgages.

Mintel’s research found that a quarter of borrowers have debts below £500, while 13% of borrowers owe in excess £10,000. The majority of those owing over £10,000 show little concern about their level of debt and some might consider borrowing more.

The most common form of borrowing is on credit cards with 29% of individuals surveyed having an outstanding balance. An additional 6% had an outstanding store card balance. The vast majority of borrowers are comfortable with their financial situation and feel that they are in control.

“While many people in debt may have the means to continue meeting their repayments, the high levels of debt and lack of worry does clearly represent a cause for concern.” Said Paul Davies, senior finance analyst at Mintel.

For those people who are concerned about multiple debts, one option could be to consider consolidating all their debts in one place with a secured loan. It is however important to remember that repaying borrowing over a longer term increases overall interest charges.

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Debt consolidation needed in England

There may be a distinct need for English consumers to take stock of their finances given the new research that they have some of the highest rates of personal debt in Europe.

A new study by Egg comparing England to its financial counterparts on the continent has shown that we are often lacking in some key economic factors when compared to our neighbours.

It seems that despite English consumers having the highest average incomes and net savings, they also suffer from the lowest household savings ratio and also the highest personal debt.

With the average English unsecured debt reaching €5,670, the borrowing culture in the UK is rapidly increasing giving many consumers a reason to consider the benefits of debt consolidation.

Alison Wright, Egg chief marketing officer, said: "England's performance is not as strong as it could be. Our research ultimately shows that we could learn some valuable lessons from our European rivals by making our money work harder for us in key areas.

"This is particularly true with regards to paying down our short-term debt, adopting a healthier savings mentality and shopping around for the best insurance deals in the marketplace.

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Monday, July 17, 2006

Convenience cash-machines may spell need for debt consolidation

Customers who use cash machines in convenience stores may find themselves in a position where they have to consider debt consolidation.

Research by HIM's Convenience Store Tracking Programme on behalf of Link discovered that customers who withdraw money in-store spend on average 65 per cent more than those who come with ready payment.

With such a high proportion of shoppers overspending on routine trips, many might find themselves in situations where they may need to review their finances and monthly expenditure.

The research showed that an average convenience store customer would spend £5.64 per visit while customers who use an in-store cash machine spend £8.99.

Graham Mott, Link spokesperson, said: "The research confirms our long held belief that cash machines in convenience stores have a positive impact on day to day business levels. Increased revenue and improved customer numbers make a compelling argument for retailers to consider installing a cash machine."

And with free cash machines dispensing 15-20 times as much money as fee-charging cash machines, many consumers are catching onto the benefits of free cash machines. For those people who do overspend, a homeowner loan could be one of a number of options to get their finances under control. It is important to remember that repaying your borrowing over a longer term will increase overall interest charges.

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Sunday, July 16, 2006

'Explosion' in secured loans providers

There has been an explosion in the number of secured loans providers, according to one industry professional.

The comments come from moneysupermarket.com spokesman Stuart Glendinning following yesterday's figures on the state of UK debt from the Consumer Credit Counselling Service (CCCS).

Mr Glendinning said it was of little surprise that debt levels had increased and that an increasing number of people were getting into debt.

He said: "One of the reasons why the secured loans providers have seen an explosion in lending in recent years is because so many people are consolidating the unsecured debts they have accumulated.

"For homeowners, this [taking out a secured loan] can be a sensible course of action, but only if they don't put themselves into a debt cycle."

A well-managed secured loan package from a reputable provider can be an important step for many consumers in managing their debt levels.

Mr Glendinning added: "This report is a fresh reminder that debt crisis is becoming more and more of an issue."

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Thursday, July 13, 2006

Credit debt climbs as DIY spending rockets

According to recent figures from Morgan Stanley, credit card spending was set to rocket over the next 3 months, the home and car being primary reasons. British card holders had limited spending in the first quarter of the year and it was predicted that credit card expenditure was set to rocket from £645 to £1,225 in the second quarter.

As well as funding home improvements, cars and holidays were also quoted as reasons for spending on plastic. Morgan Stanley stated that men were planning to spend more than women on credit cards, predicting to outspend them by £258.

Location wise, people in the Midlands and Wales were likely to spend more than any other region on their homes and cars during the spring while those in Southern England were the biggest grocery spenders.

Patrick Muir, the Morgan Stanley Credit Card Marketing Director commented ‘We are now seeing a rise in spending on DIY and holidays as we hit the Bank Holiday season. Britons are increasingly using their credit cards to pay for everyday items, including groceries, petrol and bills.’

People who find themselves having to constantly use credit cards as a payment method could consider consolidating these debts into a personal secured loan. This could lower monthly repayments and could allow more expendable income each month. It is however important to remember that spreading debts over a longer period increases overall interest charges.

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Wednesday, July 12, 2006

Increase in repossessions highlights debt consolidation need

An increasing number of homes in London are being repossessed, according to new figures reported by the Evening Standard.

In reply to a parliamentary question from the Liberal Democrats' London spokeswoman, Lynne Featherstone, it was revealed that some 6,661 homeowners were taken to court last year for failure to maintain their mortgage repayments.

This figure has trebled from 2001, when the number of people taken to court by banks or building societies stood at 1,854,

"These figures are very worrying and the rate at which they are growing signals big problems for the future," commented Ms Featherstone.

This worrying trend could potentially highlight the need of many for a debt consolidation loan that would help get finances back on track and avoid the painful experience of losing a home.

This is just one option which could help reduce monthly repayment commitments, allowing money for mortgage repayments. However, it is important to remember that repaying borrowing over a longer term will increase overall interest charges.

With average house prices in the capital now standing at almost £300,000, it is little wonder that so many people are finding it difficult to keep up with payments.

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Monday, July 10, 2006

Overstretching graduates in danger of debt

According to a recent survey by Callcredit, hundreds of thousands of graduates and students are at risk of overstretching their personal finances due to the government refusing to share details about student loan accounts. Shared data is used by the credit industry as a tool on which it bases lending decisions, however student loan information is not available to commercial lenders.

There are a few ways the effect of sharing this data can be shown, depending on the type of student loan taken. If graduates opted to make student loan repayments directly from their wages each month, they might be granted credit which they would be unable to afford as their salary would effectively be less than that declared. On the flipside, someone who has had a perfect history of repaying their student loan could be rejected for credit because they might not have anything else on their credit history, which is used by lenders to make decisions.

Callcredit industry affairs director Mel Mitchley commented “The information should be shared as it would help people who have a responsible attitude to their student debt and prevent those who are already in difficulty being granted further credit.”

Figures from March 2005 show that 2.8 million people in the UK had a student loan, with the borrowing amounting to £16.45bn.

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Sunday, July 09, 2006

Home owner loans for GSI – the new DIY

This time of year often sees many UK homeowners choosing to go ahead with home improvement jobs they have been planning for months, yet the traditional do it yourself (DIY) projects seem to be declining. New research has found that homeowners are increasingly opting for GSI or 'getting someone in' as an alternative to tackling the job themselves. Home improvement projects can be hugely effective at not only enhancing current living conditions, but also adding significant value to the property. The current competitive housing market is therefore convincing many to embark on loft conversions or extensions. Even with smaller jobs, homeowners are increasingly choosing GSI, with a study from Abbey discovering that 28 per cent of people are using professionals rather than undertaking projects themselves.

Abbey has found that GSI can actually prove more cost-effective than DIY, despite the perception of many that it would be cheaper to carry out home improvements themselves. The majority of DIY jobs take a massive 12 months or more to complete, while the cost of materials and leisure time lost can make GSI a far more attractive option.

"Overwhelmingly the perception of GSI is that it costs significantly more than doing it yourself. However, our research shows that this is not necessarily the case," explained Jeff Scott, head of Abbey Loans.

"The cost of DIY can be significantly more in terms of physical and emotional stress as well as money, particularly when the cost of leisure time and fixing DIY mistakes are factored in.

"On the whole DIY seems to be a lengthy and stressful affair which can be made much more painless by simply paying to GSI.

While over a quarter of respondents to the Abbey survey are already fans of GSI, 55 per cent would rather pay for a professional if they felt they could afford it. There are many ways homeowners can fund their DIY or GSI with home improvements often adding value to a home. A homeowner loan is one option which could be considered.

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Thursday, July 06, 2006

Debt consolidation loans for higher taxes

Britons struggling with high utility bills, credit card debt and huge overdrafts have also been hit by a considerable rise in taxes since Labour came to power, new research has indicated. Many homeowners are experiencing massive growth in stamp duty and fuel tax, which can prove to be a significant burden on households, leaving many to turn to debt consolidation loans as a way of organising their finances.

A new study by accountancy firm BDO Stoy Hayward has found that in the last year alone the government has gained 60 per cent more tax from petrol sales, while the amount filling the Treasury's pockets from capital gains tax has soared by 26 per cent. Stamp duty is also adding to the difficulties for many households, with Labour receiving 135 per cent more tax since they came to power in 1997.

"Taxpayers have particularly felt the squeeze on fuel duty and stamp duty. Combined, these taxes have increased by an astonishing 283 per cent since the government came into power, and have directly affected the pocket of most UK tax payers," Stephen Herring, tax partner at BDO Stoy Hayward, told MyFinances.co.uk.

British households are also paying more income tax, which combined with value added tax, corporation tax and stamp duty accounts for 82 per cent of the total amount collected by the government every year.

Debt consolidation loans may help households that are struggling with high tax costs on top of their other expenses. By organising all debts into just one monthly payment, it can be easier for people to stay in control of their money and keep a track of their financial situation. However, Britons are advised to consider this move carefully before taking the plunge, to make sure debt consolidation loans are suitable for their circumstances. It is important to remember that repaying your borrowing over a longer term will increase overall interest charges.

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Property prices rise again

Property prices in the UK have risen again last month, according to the latest housing market value index.

New figures from Rightmove found that the June house price index saw average asking prices going up by £1613, an increase of just under 1% compared to the previous month.

This positive economic indicator equates to the average UK house price standing at £211,442 . London fuelled the rise and saw sellers' asking prices at around £315,224. This is an 11.7% rise compared to the previous year.

Miles Shipside, Rightmove commercial director, said: “ The buoyancy of the southern economy and demand for quality property by affluent buyers are having an effect on increasing homeowners’ net worth even further.”

With these increases in house prices, many consumers may well consider a home owner loan which would allow them some extra financial leeway for a summer getaway or a series of improvements to their house or garden.

Using a home owner loan to undertake home improvements or garden refurbishment could be a great way to increase the value of your property in the long run.

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Tuesday, July 04, 2006

Brits urged to think about their debt

Too many Britons are failing to consider their finances, instead worrying about matters which they cannot control, it has been claimed.

New research has suggested that many Britons spend time worrying about matters which they can have little influence on, when instead they should be looking into ways to clear their debt. According to a study carried out by Prudential, not enough people are looking at the debt that they are in and are spending more time worrying about things they are unable to control.

Other factors preying on consumers' minds are the threat of so-called superbugs, which have caused havoc in some hospitals, as well as the danger of a terrorist attack. But Paul Cowman, head of protection at Prudential, points out: "You're far more likely to lose your job and struggle with debts than be a victim of terrorism or superbugs."

Mr Cowman added: "An age of fear is gripping the country and it is entirely irrational."

While people are becoming increasingly concerned about issues such as bird flu and security, many are becoming more relaxed about their finances, despite the high levels of consumer debt in the UK. There is concern that the public is failing to properly look into solutions to their financial difficulties and as such may be overlooking the possibility of taking out a debt consolidation loan that could significantly ease the burden of debt.

Dr Peter Marsh, of the Social Issues Research Centre, commented that people today "lose a proper focus on risk and get diverted away from real threats", such as financial insecurity, which could cost a person their home. It is therefore important that people focus on things in their lives which they are able to influence, such as personal debt.

One way of controlling rising personal debt would be to consolidate it into a secured homeowner loan. While this is only one option, it allows for the possibility of reducing monthly payments on debts, as the loan repayments can be made over a longer period of time. It is however important to remember that repaying your borrowing over a longer term will increase your overall interest charges.

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Monday, July 03, 2006

Homeowner loans for big spenders

New research by market analysts Mintel has revealed that consumer spending has reached an all time high in the UK, with over £1 trillion being spent last year.

Borrowers who are struggling to control their spending may wish to acquire homeowner loans rather than building up hefty overdraft or credit card debt.

Each household in the UK forked out an average of £37,000 last year on areas including housing, food, transport, utilities, cars, and holiday; a 43 per cent growth in real terms compared to a decade ago.

A large percentage of the spend came in the purchase of non-essential and luxury items including electronic products and trips abroad.

"The last ten years have clearly been the decade of big ticket purchases and buoyant expenditure on these items such as holidays, cars, furniture and appliances reflects the growing affluence of the British nation as a whole," commented Mintel's director of research, Paul Rickard.

Consumers who have run up debts on multiple credit and store cards and would like to straighten out their finances could consider consolidating these with a secured loan.

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Sunday, July 02, 2006

Make home improvements but avoid the expense of a special offer store card

A recent survey by Alliance and Leicester has shown that one in three homeowners were ready to spring into action over the last Easter bank holiday weekend. DIY and home improvement work is always a firm favourite past time for the long bank holiday weekends. While 76% of homeowners have made more than one major improvement to their current homes, the extra day off work gives DIY enthusiasts a little more time to get stuck into home improvement projects.

The Alliance and Leicester survey found that the top improvement among British homeowners was painting, with 82% of respondents saying that they would be keen to add a touch of new colour to their homes. Wall papering was favoured by 56% of respondents and 55% were interested in tiling their homes. New kitchens, windows and bathrooms were also on respondents wish lists.

The survey by Alliance and Leicester revealed that a third of consumers admit to using costly point-of-sale finance to pay for important home improvements such as a new kitchen, conservatory or double glazing; and 36% of these individuals believed this type of offer to be competitive.

It can be tempting to take advantage of a 12 month interest free period when presented with the option to take out an account card at the point of sale. However, the interest rates on some retail store cards can be significantly higher than those offered by secured homeowner loan lenders. Rates for store cards can be as high as 26%. Homeowners looking to carry out significant home improvement projects could consider a secured homeowner loan to help them carry out their desired plans, as one of their options. It is important to remember that repaying your borrowing over a longer term will increase your overall interest charges.

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Monday, July 24, 2006

Plight of pensioners indicates it makes sense to clear debt before retirement

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Thursday, July 20, 2006

Price rise could encourage home owner loans

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Wednesday, July 19, 2006

Spend now pay later lifestyle

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Debt consolidation needed in England

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Monday, July 17, 2006

Convenience cash-machines may spell need for debt consolidation

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Sunday, July 16, 2006

'Explosion' in secured loans providers

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Thursday, July 13, 2006

Credit debt climbs as DIY spending rockets

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Wednesday, July 12, 2006

Increase in repossessions highlights debt consolidation need

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Monday, July 10, 2006

Overstretching graduates in danger of debt

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Sunday, July 09, 2006

Home owner loans for GSI – the new DIY

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Thursday, July 06, 2006

Debt consolidation loans for higher taxes

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Property prices rise again

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Tuesday, July 04, 2006

Brits urged to think about their debt

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Monday, July 03, 2006

Homeowner loans for big spenders

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Sunday, July 02, 2006

Make home improvements but avoid the expense of a special offer store card

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