December 1st, 2008
While the interest rates are almost at their lowest ever, many people are still struggling to afford their mortgages: repossessions are climbing and are 71%higher than October 2007. Things are looking bleak for those who do not have access to information and resources, many of which are sponsored by the government.
If you think your property may be in danger of being repossessed, do not leave things until it’s too late. There are many different organisations that can help you figure things out and the banks have been warned: do not repossess a property unless there is no alternative. Mortgage lenders now have to prove how they tried helping a defaulting client.
Mortgages aren’t all they’re cracked up to be. They’re costly and not for everyone. This means that some are considering taking a break from the property market and going back to renting. They are selling their properties to invest the cash somewhere else. This could mean that your finances look healthier and your lifestyle could improve, too.
If you finances were in a poor state before, because you could not afford your mortgage payment, then you may be saved from repossession and being made bankrupt.
But many people still feel as though renting is not really an option for them, and the long term goal is to own a home of their own, without any further mortgage payments. If this is your goal but you are struggling to make your mortgage payment, now is the time to think of ways to make things financially better. Consider renting out a spare room — there should be many around, with some of them being former homeowners.
Posted in Mortgage Guidance | Comments Off
November 25th, 2008
Alistair Darling has lowered value added tax to the lowest level that the EU law allows. Value added tax is now 15 per cent, which is 2.5 per cent lower than what it was. This alone could help the average British family save £10 a week, though the saving might be offset by the increase in alcohol, tobacco and fuel duty. However, this should equal a £12.5 billion injection into the economy.
This cut is a temporary one: it will last until the end of 2009 only.
Mr Darling announced the cut in his pre-Budget report on 24 November. The report has already angered Conservatives: they are calling Mr Darling a gambler who doesn’t want to give up. However, Chancellor Alistair Darling believes the cut should encourage consumer spending: it could mean consumers receive 12.5 billion pounds back in their pockets.
The government wants retailers to pass on the saving to consumers by offering price reductions. Retailers such as Currys, PC World and Dixons, as well as Marks and Spencer are planning to cut their prices and increase consumer confidence. However, basic groceries are not liable to VAT so the average Christmas dinner will not be any cheaper this year.
The government is planning to cut VAT, boost tax allowances and offer more cash to parents and pensioners.
What the pre-Budget means for you:
- VAT is reduced from 17.5 to 15 per cent until the end of 2009.
- Those earning more than £150 000 a year will be taxed at 45 per cent from 2011.
- Motorways, social housing and schools receive £3 billion.
- The rise in corporation tax has been postponed.
- National Insurance rates increase by 0.5 per cent from 2011.
- Pensioners’ credits are increased and they also get a £60 bonus this Christmas.
- Air passenger duty will be replaced by new system and long-haul passengers pay more.
- Child benefit credits increase in January, which is three months earlier than expected.
- Taxpayers receive a £145 rebate as compensation for scrapping 10p tax band from April 2009.
Posted in Misc Finance News | Comments Off
November 5th, 2008
First it helps to know the term ‘credit crunch’ means. Credit crunches happen when banks struggle to get hold of money. They are forced to pay more interest on the money they get and pass that onto their clients – us.
The credit crunch affects everyone, even those who do not need credit to pay for food, education, transport or accommodation. Everything is influenced by this because many businesses use credit.
Property
The mortgage market is a strange place right now. While the rates may still fall further, it has now gone into reverse and buyers need to think carefully about buying property.
Banks are not willing to lend much money. Those who are lucky enough to get mortgages will pay more for it, and they will need a larger down payment. Property buyers especially should make haste to get their mortgages approved.
The Economy
Some of our economists are expecting a recession either later this year – 2008 – or early next year. The growth of the economy has slowed down and the rise in inflation hasn’t helped. Lowering the interest rates may help, though it’s not likely to help much: the money markets are in too much turmoil at the moment.
Unemployment
In just the few months between May and July, nearly 140 000 people were made redundant. This amount makes it the highest rise since the early 1990s – the total stands at 1.7 million and some think it may be 2 million by this Xmas. Workers, especially those from the financial sector all over the world, are being laid off: 7 000 Chinese workers at a toy factory; 15 000 West Java workers; and many Fortune 500s let workers go.
Finances
The credit crunch is less harsh on savers; however, even they should be careful: they should make sure that their money is in a safe place. All banks are created equal but some are better than others. One good thing, however, is that banks are trying to attract capital and are offering better rates – 6.5 per cent in some instances.
Most medium- and long-term investments should be fine and those who invest now will get more for their money’s worth. So it’s not really all doom and gloom, even though the media wants us to believe that.
Posted in Credit Crunch | Comments Off
October 28th, 2008
Relationships are difficult enough when there is plenty of money around, so they can be disastrous without money. There are many surveys on this subject: some couples struggle to manage their finances. This may be learnt behaviour from their parents or it may be newly acquired habits that take a toll on the relationship.
If you want your relationship to survive the money woes it is important that you and your partner discuss everything.
Does your partner know how much you are worth? Even financially secure couples may not know their partner’s net worth: the wife may have emergency money stashed away or the husband may have a secret club membership. There are even books out there which encourage women to hide money from their husband, but this should not really be encouraged if you want to be financially open with your partner, not even when spending money on luxury items.
Talk about your salaries, debt, and common financial goals. Setting up a budget is important – as long as you ensure that you both stick to it. If the other partner doesn’t know you have a lot of debt, find a way to tell him or her. And do it before things start looking financially bleak or bleaker than what they are now.
Posted in Debt Aid | Comments Off
October 21st, 2008
At what point did you realise you need to contact a professional to help you deal with your debt? It is possible to ignore debts for a short while; however, it is short-sighted to do so. There are many people who are battling with their finances; some might even be thinking of suicide to escape their financial woes.
Did you realise that you need to cut back on early morning espressos and satellite television early on, or was it a late revelation?
Easy credit has been a benefit to us, but it has also created a big problem: we have forgotten what it is like to save up money to buy a big item. Instead, we use credit cards, payday loans and any other form of credit to get what we want – now.
Are you like this, or are you more prudent? We would love to hear from you in the comments section. Let us know what changed your mind about credit. Have you burnt your fingers with a credit card or an unsecured loan? And we would be very interested to hear how long did it took you to find help from a professional organisation.
Posted in Debt Aid | 1 Comment »
