Lucid Mind

A financial services company stated that in order to add to their disposable income a number of homeowners in the UK were making use of the beneficial equity release.

Director of financial services of Help the Aged subsidiary intune group, Mark Gettinby stated that a number of people were using the products to pay back mortgages and debts due to credit cards.

He further issued a warning that people who were interested in equity release should seek counsel and guidance before going in for a plan. As he believes that people are quite unaware of the workings of equity release.

He encouraged the public to take advice from a specialist before taking any further steps, as equity release was not to be taken lightly.

Dean Mirfin, business development director of Key Retirement Solutions voiced Mr. Gettinby’s thoughts and said that retired homeowners should seek advice in order to make sure that they don’t land up paying too much for these equity release plans.

Since providers looking for sales were highly unlikely to urge retirees in the right direction towards the best deals.

A new report suggests that nearly one in ten people who were planning to buy a house have fast forwarded their plans.

38 percent of the people, who want to buy a house, want to do it this year and nearly 34 percent are planning to buy one in 2009. This is per a survey that was conducted by fool.co.uk

Fool.co.uk’s, head od personal finance, David Kuo stated that given the current situation in the market, many people will realize their dream of buying a house. What these people should be asking is, how much can I afford to repay as against asking, how much can I borrow?

The report states that, the next five years or so will see more sellers than buyers, which means there will be five sellers for every four people who want to buy a house.

Fool.co.uk is an organisation that aims to redefine the people’s perception of finance.

A new research reported that as household budgets became tighter, millions of bills were not paid last year.

People tended to overlook the council tax in the second half of the last year and nearly 2.3 million did not pay this tax or made a late payment. This was revealed in a research that was undertaken by

YouGov for MoneyExpert.com. Also 1.3 million people found it extremely tough to pay up their energy bills as the due date.

The financial advice website further warned that with increasing gas and electricity prices in addition to the ongoing credit crisis, people may find it still harder to pay their bills on time. As a result of this many would have to face serious consequences.

Chief executive of MoneyExpert.com, Sean Gardner stated that while paying a bill late is not something quite serious, however if this becomes a habit then action would be taken.

He further adds that missing bill payments could have serious repurcussions, it could mean that you could lose that service or might even land up in court.

YouGov statistics provided by moneysupermarket.com revealed that about 3 million people in the UK did not make their credit card payments on time and thus had to shell out 35 million in fees.

Nationwide Building Society demanded that with the average savings rates falling below inflation, savers should be warned as to when introductory savings rates expire and accounts fall to low rates.

The current situation is such that some banks and building socities offer high initial rates of interest on savings. This is generally for a year, which then falls below the Bank of England’s base rate.

Nationwide is demanding that all savings providers warn customers when their account rates will go low. Customers should be also informed if better deals are available.

Rivals firms are benefiting from customer’s apathy, which means that many people do not monitor their returns on savings carefully, claims the building society.

Director for savings at Nationwide, Matthew Carter, stated that due to the savings market being so competitive many providers are eying the market share. In fact a couple of providers are more interested in making profit and achieving what is best for them rather than offering customer long term value.

He further adds that just as customers are informed about the change in their mortgage deals, this shouldn’t be any different. With so many introductory deals becoming common, the society is quite worried that it’s getting tougher for savers to make the right decision.

Moneyfacts.co.uk’s Lisa Taylor, advises savers to look into accounts with steady rates of interest instead of switching over to what seems like a better offer. She stresses on the fact that most often a simple account will provide a good return and one does not need to go through the rigmarole of dealing with complicated rules and regulations. Given the ever changing market, a good performing account will offer good returns and there’s really no need of spending endless time and effort to search the market on an on-going basis.

With the interest rate cut in December, savers have seen a lowering of rates, nearly by 0.25 percent points removed from the base rate.

Ms. Taylor further elaborated, that a number of savers have seen their rates cut down by more than twice the base rate cut.  Moreover with a couple of accounts already offering uncompetitive rates, the proportion of the rate cut down is actually much higher. Taking Halifax Liquid Gold as an example, she points out that they saw a 0.36 percent cut. The rate in November was 1.36, which means that more than a quarter of the entire rate was done away with.

Big players such as Lloyds TSB, HSBC, Abbey, Royal Bank of Scotland, Halifax, NatWest and Alliance & Leicester are other lenders who have cut saving rates.

She added that many customers were keeping their hard earned savings in accounts that in the long run would not yield any value. Currently as 3.77 percent is the average savings rate of  Moneyfacts.co.uk.

In fact she said that a number of accounts that were hit the hardest were no longer marketed and were just held by loyal long standing customers. This however is an example of loyalty not being beneficial.

It is advisable that for those Britons who made a resolution this New Year to take stock and settle their financial woes, should make a 12 month budget plan.

The Consumer Credit Counselling Service (CCCS) stated that planning ahead was always useful for people with a couple of outgoings such as annual car insurance, quarterly bills etc.

Spokesperson for CCCS, Frances Walker stated that people should sit down and plan a budget. It’s always advisable to create an annual budget and dividing it by 12 so that you properly account for things. Moreover at this time people should also think about income maximisation.

Ms. Walker said that those who paid over 20 percent of their income towards monthly repayments, were stretching limits. A single monthly payment with the help of debt consolidation was the key to reducing monthly outgoings as well as handling these situations in a better manner.

As per Credit Action statistics, the total UK debt currently sits at 1,400 billion pounds.

A recent research revealed that the 9 billion pounds, credit card balances are expected to be transferred to other cards in the New Year.

The Abbey commissioned a survey of more than 1,000 people which found that the equivalent of 3 million British credit card users have plans to transfer their credit card balances.

2,666 pounds is expected to be the average balance transfer in the first quarter of 2008, with nearly 8 percent men and seven percent women stating that they would take advantage of credit card balance transfer deals.

It was seen that men were more likely to transfer bigger balances in comparison to women, with men moving 3,395 pounds and women just 1,820.

Moreover those from Midlands and south-east of England said that they intended to transfer around 3,021 and 2,900 pounds, much more than the amound of 2,501 pounds of Northern England and the amount of  2,154 pounds of Scotland and Wales or the amount of 2,022 pounds of south-west.

Managing Director of  Abbey Credit Cards, Roger Lovering stated that it was good to see that many people were already taking action towards their financial situation. He further said that generally the credit cards bills in January catch many people off guard so it was advisable that people check their card expenses over the festive season.

Defaqto reports that depending on the size of the loan, people going in for a loan may be able to save money.

The financial researcher states that rate of interest is higher on loans that fall on the lower tier.  Furthermore, people may land up paying more for a lower amount of money, more so when loan providers have 2 tiers in the range of 1,000 to 5,000 pounds.

David Black, Defaqto’s principal consultant of banking commented on the research stating that borrowers should be careful when they choose their loan amount. They would be able to save quite a large sum of money, just by putting in a little time and effort towards researching the interest rates that are charged on different tier levels.

If one takes a bigger loan, it could mean that the duration of paying that loan is much longer, however the savings could be as large as 1,000 pounds.

Keeping this in mind, Defaqto have encouraged consumers to be careful when it comes to taking loans. They further said that a large tier need not mean uncompetitive rates.

Moreover Defaqto research indicated that customers often get a better deal when they switch credit cards rather than remaining with their original one, as this would allow them to claim, credit cards reward disloyalty.

The Department for Work and Pensions (DWP) feels that those who have overspent over the Holiday season should start to think of their future financial plans.

DWP further stated that mainly due to insufficient planning for the season and other such big events, leave people in a financial lurch, and they struggle to repay their bills.

A DWP research reported that more than 50 percent of Brits tend to overspend at Christmas, with many areas facing severe financial problems.

Jobcentre Plus’s Susan Clark stated that many people find themselves stressed out and struggling to repay the high bills that are accumulated over Christmas.

One way of dealing with this stress is to keep control over one’s finances. A good way of doing this is going in for a loan consolidation.

In addition, the DWP announced that it had plans to create a new unit in order to deal with child poverty in the UK. DWP statistics revealed that nearly 600, 000 children were lifted out of povery over the last ten years due to government policies and measures.

The Home Builders Federation (HBF) believes that with the introduction of the Energy Performance Certificate (EPC), in the future, environmental issues could have an impact on the purchases of houses.

In all probability, this new certificate would raise issues such as insulation and the benefits of a good level of energy efficiency, says the trade association for homebuilders.

HBF’s Director of external affairs, John Slaughter says that be believes that the EPC would have some impact on how people would feel about purchases. He further says that if there’s talk about an increase in energy prices then people would be more concerned about the climate while taking those things in consideration. 

The main advantage of the EPC would be that it would increase the awareness of the benefits of good levels of energy efficiency and insulation. People would not merely be concerned with the costs of comfort for running the home.

Through the ‘Building a Greener Future’ policy, the government aims to encourage greener homes. Carbon-neutral homes are exempt from stamp duty due to this policy.

Northern Ireland’s Royal Institute of Chartered Surveyors (RICS) reports, that prices of houses in Northern Ireland are coming down following the massive growth of house price last year.

The RICS further states that sales should perk up in 2008 though people who want to sell their houses should be more realistic where the price is concerned.

Housing spokesperson for Norther Ireland’s RICS, Tom  McClelland, stated that during 2007 the market has changed quite a bit and one has to be aware that agents have to put in that extra bit to make sales. In addition sellers should be more realistic about the prices that they ask for. This represents the new market.

He further adds this change in the market situation could prove to be beneficial for first time buyers, mainly because there is not so much competition for houses that are within the pricing range of first time buyers.

At nearly 150 pounds a day, Northern Ireland saw the fastest price growth of houses in the UK, at the end of last year.