Debt Consolidation Advice, Help and News from Debt Advisers Direct
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Current Feed Content from 13 Oct 08 15:10
Government scheme to free up credit markets
Mon, 13 Oct 2008 13:54:40 GMTToday, the government announced a £50 billion scheme to restore confidence in the UK banking industry and kick-start lending.
To quote from the Government’s News Distribution Service, the proposals aim to:
- Provide sufficient liquidity in the short term;
- Make available new capital to UK banks and building societies to strengthen their resources permitting them to restructure their finances, while maintaining their support for the real economy; and
- Ensure that the banking system has the funds necessary to maintain lending in the medium term
“Basically, ” said a spokesperson for Debt Advisers Direct, “The Government is trying to reinforce confidence in the whole banking system by making more cash available to it.
“Recently, banks have been reluctant to lend money to each other – which means there’s been less credit available to normal consumers, from mortgages to credit cards and debt consolidation loans. The banks themselves will benefit from the scheme, and so will consumers. As the BBC reports: ‘Negotiations will take place with each participating institution that will require them to extend normal credit lines to homeowners and small businesses’.
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Debt Advisers Direct offer a range of debt advice and debt solutions, including debt management plans, debt consolidation and IVAs (Individual Voluntary Arrangements).Interest rate cut `will help some struggling borrowers`
Fri, 10 Oct 2008 11:25:14 GMTThe cut in the UK`s base rate of interest announced earlier this week by the Bank of England`s (BoE`s) Monetary Policy Committee will help some struggling borrowers, an industry body has suggested.
According to the Building Societies Association (BSA), the reduction will assist people who have taken out variable rate home loans.
However, it went on to say that consumers with fixed-rate deals and those linked to money market rates may not benefit immediately because the rates of such mortgages are not determined by the base rate.
The BSA added: "Although [the] news will clearly help those with repayment difficulties, borrowers who still think they might encounter problems repaying their mortgage should get in touch with their lender as soon as possible."
On Wednesday of this week (October 8th), the BoE announced it was lowering interest rates from five per cent to 4.5 per cent as part of an international effort which saw similar action taken in the US, Europe and China.
`Not surprising` loans are becoming more expensive
Thu, 9 Oct 2008 11:42:04 GMTGiven the fact that the credit crunch was precipitated by bad debt, it is not surprising that cheap credit is drying up, it has been suggested.
Writing in the Manchester Evening News, David Ottewell stated that many banks are now restricting their best borrowing rates to people who have "impeccable" credit histories, rather than those with bad credit ratings.
He said: "The flood of cheap credit that has washed over Britain in the last decade is finally drying up."
According to Mr Ottewell, consumers can expect to pay an average of around nine per cent interest on loans now, compared with less than six per cent a year and a half ago.
Meanwhile, credit card firms are also limiting their lending and are watching more carefully for signs that customers are struggling to make their repayments.
Figures produced earlier this month by the Bank of England suggested that lenders reduced the availability of secured credit to households in the three-month period ending in September by more than they had anticipated they would when questioned earlier.
Women `risking debt for families through lack of insurance`
Thu, 9 Oct 2008 11:39:33 GMTBy failing to secure insurance, women in the UK may be putting their families at risk of future finance problems, potentially including debt.
This is the finding of a study conducted by AXA, which found that while there has been a significant rise in the number of women who contribute significantly to the income of their families, relatively few females take out cover products such as life insurance.
According to the firm, eight million working women do not have critical illness cover, life insurance or income protection in place.
Commenting on the findings, head of protection at AXA Iain Mallon said: "Unlike during the 1970s, women becoming ill and unable to work now could have significant financial implications for the whole family."
In other news, research conducted by YouGov recently on behalf of trade body R3 found that 21 per cent of UK households are now finding bills a constant struggle, potentially putting them at risk of insolvency.
Govt actions `could lead to debt for pensioners`
Wed, 8 Oct 2008 11:25:33 GMTThe government`s response to the banking problems in the UK could lead to a deepening of the pensions crisis.
This is the opinion of independent policy advisor Dr Ros Altmann, who described the Labour administration`s decision to increase guarantees for savers as "knee-jerk".
She stated: "It`s far safer now to put your money into a bank than a pension or any other long-term investment, because there is suddenly a 100 per cent guarantee, whereas the Financial Services Compensation Scheme or Pension Protection Fund only cover around 90 per cent up to a capped amount."
Dr Altmann went on to say that this will serve to undermine confidence in pensions and, thereby, may result in poverty - and potential debt - for the over 60s.
Meanwhile, a recent report by Citizens Advice Scotland suggested that retirees in the country are subject to greater levels of debt than they were four years ago.
According to the organisation, people aged 60 and over are 25 per cent more indebted than was the case in 2004.
Reuters: Pay ‘is a key political issue’
Mon, 6 Oct 2008 10:47:42 GMTMedian pay deals in Britain have risen, says Reuters, citing figures from independent research organisation Incomes Data Services.
According to Reuters, median pay deals in Britain ‘rose to 3.8 percent in the three months to August’.
Other indicators, however, suggest that ‘pay pressures remain subdued’, since employees’ bargaining power has been reduced as a result of today’s economic troubles.
Pay ‘is a key political issue in Britain at a time when rising living costs are squeezing households’ disposable income’, says an article on Reuters’ website.
“As the cost of living increases, ” said a spokesperson for debt consolidation experts Debt Advisers Direct, “it’s only natural that people want their salaries to increase. However, many companies, worried about their own finances, are reluctant to grant significant pay rises.”
“In some cases, borrowers could reduce their monthly expenses with a debt consolidation loan, which could simplify their finances as well as bringing their monthly debt repayments down to an affordable level.
“Consolidation loans, however, are not always the answer – it’s important that borrowers talk to a professional debt adviser who can help them decide whether they should consider other debt solutions.”
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Debt Advisers Direct offer free debt advice and a range of debt solutions, including debt management plans, debt consolidation and IVAs (Individual Voluntary Arrangements).Extended Liquidity Scheme: good news for borrowers
Mon, 6 Oct 2008 12:38:17 GMTIf you have been looking to obtain credit (such as a debt consolidation loan or overdraft facility) in recent months, you may have noticed that the credit crunch has made it much more difficult. It’s not just because lenders have tightened their lending criteria – in many cases, it’s because the lenders simply can’t provide the funds themselves.
The Special Liquidity Scheme was originally put in place to ease the liquidity crisis in the UK, in which banks and other financial institutions were unwilling or unable to do business with each other on the wholesale financial markets – which in turn severely limited funds for loans and other forms of credit.Debt consolidation loans & the threat of recession
Mon, 6 Oct 2008 12:42:6 GMTThese are difficult times for people thinking about consolidating their debts. The way the economy has changed in the last year has made debt consolidation loans both more valuable and more difficult to get hold of…
Consolidation loans – more important than ever!
On the one hand, consolidation loans are more essential than ever. Unemployment is rising and so’s the cost of living – so more and more people are having to stretch less money further and further. That’s the type of challenge a consolidation loan could help someone meet.Financial gloom may encourage rate cut
Fri, 3 Oct 2008 15:54:28 GMTA recent survey of manufacturers may make a cut in the Bank of England’s base rate more likely, the Financial Times reports.
Measuring output reported by purchasing managers, the Chartered Institute of Purchasing and Supply/Markit report on manufacturing returned a reading of 41 for September, its lowest reading since the survey began in January 1992.
Down from 45.3 in August, this ‘represents a marked shift to pessimism and falling sales’, according to the Financial Times.
Increasing economic gloom may encourage the Bank of England to lower its base rate in a bid to stimulate the economy – something which may interest borrowers thinking of consolidating their debts.
Since the interest rates on various kinds of debt (from mortgages to debt consolidation loans) can be linked to the base rate, any rate cut by the Bank of England could help people in debt, reducing both the amount they pay on some of their existing debts and the cost of a potential debt consolidation loan.
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Debt Advisers Direct offer a range of debt advice and debt solutions, including debt management plans, debt consolidation and IVAs (Individual Voluntary Arrangements).Increased longevity `may spell debt for UK pensioners`
Fri, 3 Oct 2008 11:28:14 GMTAs people continue to live for longer in the UK, more must be done to avoid personal finance problems for those who have retired from work, the Life Trust Foundation has said.
During a recent seminar hosted by the organisation, minister for pensions reform Mike O`Brien said: "People are living longer but some are not saving enough for later life. It is one of the biggest challenges facing us."
This may put consumers at risk of debt problems in their post-work years.
However, Mr O`Brien added that the government is in the process of reforming the pensions system in order to avert a crisis in the future.
Meanwhile, Lord Hunt of Wirral, the chairman of the Life Trust Foundation, added that a 50-year-old today has a one in four chance of reaching the age of 95.
He went on to say that these "extra years" can be very expensive when expenditure on essentials such as healthcare are taken into account.
Currently applying for charitable status, the Life Trust Foundation aims to raise public awareness of the financial implications of increased longevity.
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Debt Advisers Direct offer a range of debt advice and debt solutions, including debt management plans, debt consolidation and IVAs (Individual Voluntary Arrangements).
`More people ringing Samaritans over debt worries`
Thu, 2 Oct 2008 09:43:59 GMTAn increasing number of consumers in the UK are calling the Samaritans over concerns about debt, it has been suggested.
According to a BBC report, the organisation - which provides confidential emotional support to those in distress - has seen an increase in calls of 25 per cent compared to last year as a direct result of the credit crunch.
Shaun Kelly, outreach and communications co-coordinator at the central London branch of the organisation, said: "Debt is known to contribute to emotional distress and sometimes people in financial difficulty can consider suicide as a way out of the situation that they are in."
He added that is it "really important" for people experiencing personal finance problems to talk to someone about their situation, rather than keep it to themselves.
Meanwhile, pawnbroking firm Albermarle & Bond recently reported a rise in profits of 40 per cent compared to last year as consumers in the UK who are unable to access credit due to tighter lending conditions increasingly turn to selling their possessions.
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Debt solutions experts http://www.DebtAdvisersDirect.co.uk/ provide debt consolidation loans, debt management and IVAs.
Brits `concerned about retirement finances`
Wed, 1 Oct 2008 11:22:00 GMTThe confidence felt by Britons concerning their standard of living in retirement is falling, a new survey has found.
Conducted by Alliance Trust, the research found that 43 per cent of the population now feel they will struggle with their personal finances after giving up work.
This represents a decrease in confidence compared with last year, when 40 per cent reported such concerns.
In addition, it was discovered that women are more worried about the prospect of financial difficulties, potentially including getting into arrears on debt repayments, than their male counterparts.
Whereas 49 per cent of the females questioned reported concerns about their post-work finances, only 36 per cent of men did likewise.
Commenting on the figures, Steve Latto, pensions development manager at Alliance Trust, said: "In the current economic conditions, consumers are taking a much more pessimistic view of their retirement prospects and are losing confidence about being able to provide for a comfortable retirement life."
Last week, David Black, principal consultant of banking at Defaqto, described equity release as a feasible option for pensioners struggling in the light of current economic conditions.
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Debt Advisers Direct offer a range of debt solutions, including debt management plans, debt consolidation and IVAs. For more information, click here
Millions of children in poverty
Tue, 30 Sep 2008 13:23:35 GMT98% of children in some areas are in families classed as ‘struggling’, according to the Campaign to End Child Poverty – a total of 5.5 million across the UK.
“There are currently 3, 900, 000 children in the UK that are classed as actually living in poverty, ” said Campaign director Hilary Fisher, according to the BBC.
A coalition of well over 120 organisations including Barnado’s, Save the Children and the NSPCC, the Campaign classes households as being in poverty if they live on less than £10 per person per day.
“As the Campaign points out, ” said a spokesperson for debt consolidation experts Debt Advisers Direct, “poverty has a profound effect on every aspect of a child’s life.
“At Debt Advisers Direct, we wholeheartedly support the Government’s promise to halve child poverty by 2010 – and end it by 2020.”
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Debt Advisers Direct offer a range of debt advice and debt solutions, including debt management plans, debt consolidation and IVAs (Individual Voluntary Arrangements)Mortgage approvals `hit by continued market uncertainty`
Tue, 30 Sep 2008 11:15:05 GMTThe number of home loans being approved in the UK remains low as a result of the ongoing uncertainty surrounding house prices.
This is according to the Building Societies Association (BSA), which suggested that over 50 per cent of people recently questioned stated that the prospect of future house price falls is acting as a barrier to investing in property.
Land Registry figures cited by the association reveal that homes in England and Wales fell in value by 4.6 per cent last month, potentially suppressing mortgage demand.
It was also found that house prices in London fell by 3.2 per cent in August.
Commenting on the market, BSA business economist Andrew Gall said: "Activity in the housing market remains depressed, so, although the figures for both net approvals and net lending are better than for last month, they still remain low."
Meanwhile, BSA figures suggest that building society gross lending in August of this year stood at £2, 770 million, compared with £4, 770 million over the same month in 2007.
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Debt solutions experts http://www.DebtAdvisersDirect.co.uk/ provide debt consolidation loans, debt management and IVAs.
IVA: a preferable alternative to bankruptcy?
Mon, 29 Sep 2008 12:15:10 GMTIf you’re struggling with debts of £15, 000 or over that you think you are unable to repay, you may be considering an IVA (Individual Voluntary Arrangement). An IVA is a legally-binding agreement between you and your creditors that enables to repay only what you can afford.
IVAs were introduced by the Government as part of the Insolvency Act 1986, as an alternative to bankruptcy. By comparison, an IVA will enable creditors to reclaim more of the money they are owed. However, that is not to say that an IVA is always the ‘preferable’ option.Banks should save ‘in times of boom’
Mon, 29 Sep 2008 16:50:24 GMTEconomic crises could be avoided if banks put money aside for a rainy day, said Sir John Gieve, Bank of England deputy governor.
“We need to create reserves based on macroeconomic factors, which can be drawn down as the cycle turns down and have to be replenished on the upswing when profits are high, ” he said.
A practice such as this, the Guardian reports, could ‘prevent banking crises like the current one pulling down whole economies in their wake’.
Today’s economic troubles are pushing many into debt, and preventing many others from accessing the debt consolidation loans which could help them manage their debt and regain control of their finances.
But greater reserves could dramatically reduce the impact of any credit crunch by making banks less reluctant to grant debt consolidation loans, mortgages and other forms of credit.
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Debt Advisers Direct offer a range of debt solutions, including debt management plans, debt consolidation and IVAs (Individual Voluntary Arrangements). To find out more, contact one of our expert debt advisers.Equity release ` feasible option for struggling pensioners`
Mon, 29 Sep 2008 11:55:30 GMTEquity release should be seen as a feasible option by pensioners struggling in the light of current economic conditions, an expert has said.
David Black, principal consultant of banking at Defaqto, made his comments in response to a guide issued by consumer watchdog Which? that advised consumers to see such a move as a last resort.
According to Which?`s report, equity release schemes can be expensive and inflexible and can leave people without enough money left to fund alternative accommodation if their circumstances change.
However, Mr Black stated: "In an age of financial shocks, inadequate pension provision, low annuity rates and burgeoning levels of personal debt it seems somewhat hasty to arbitrarily downgrade one of the possible solutions."
He went on to say that while equity release is not suitable for everyone, it is an "appropriate solution" for many consumers, adding that it should be considered alongside other options as a possible source of retirement income.
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Debt solutions experts Debt Advisers Direct (www.debtadvisersdirect.co.uk ) provide debt consolidation loans, debt management and IVAs.
Energy companies ‘blocking price comparison’
Fri, 26 Sep 2008 14:16:41 GMTSeveral energy companies are blocking price comparison websites from accessing their best deals, it has emerged.
Price comparison site Fool.co.uk say that a number of companies are updating their tariffs several days after the prices are announced on their own websites, in an apparent attempt to limit the amount of customers getting the cheapest deals.
This is in conflict with Energywatch’s Confidence Code, which advises suppliers to ensure all their tariffs are listed on comparison sites.
The main issues occur when companies are slow to update prices on existing tariffs, meaning customers may be misled as to what the best deals are at any given time.
A spokesperson for debt management company Gregory Pennington said: “This highlights a lack of honesty amongst energy suppliers. In the current climate, finding the cheapest energy deal is important, as it can save a lot of money and help to keep people out of debt.
“We recommend anyone using price comparison websites to contact the supplier beforehand to make sure the plan they choose is being offered as advertised.”
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Debt Advisers Direct offer a range of debt solutions, including debt management plans, debt consolidation and IVAs. For more information, click here.Company reduces rate of home loans
Fri, 26 Sep 2008 10:11:44 GMTA financial services provider has reduced the costs of some of its mortgages, it has been revealed.
In news that may be welcomed by consumers experiencing personal finance issues, Britannia has announced it is cutting its two- and ten-year fixed-rate mortgages, as well as its buy-to-let range and its flexible and offset packages.
Commenting on the move, Tim Franklin, managing director of member business at Britannia, said: "Last week we introduced a number of cuts to some of our mortgages, now we have brought the rest of our mortgage range in line."
He added that the firm has changed the loan-to-value bands across its whole range of home loans in an effort to provide consumers with more choice.
Recently, consumers were urged by uSwitch.com to make the most of cuts in personal loan rates introduced by Moneyback Bank.
The firm decreased the interest it charges on loans valued between £7, 500 and £15, 000 from 8.4 per cent to 7.8 per cent, in a move described by uSwitch.com as part of a yo-yo strategy.
47% considering car sharing
Thu, 25 Sep 2008 10:40:31 GMTHigh fuel costs are forcing almost half of the population to consider car sharing as a means of cutting down on expenses, a new report suggests.
The report by the AA suggested that 47% of the population are considering car sharing, although only 11% actually do so more than once a week.
“Car sharing, ” said Edmund King, president of the AA, “is something that we really believe in – not only is it a good way to reduce emissions and congestion on the road, but can also save on motoring costs.”
A spokesperson for Debt Advisers Direct said that car sharing is a good way of reducing outgoings, but it may not always be enough to keep people out of debt.
“There are a lot of financial pressures on consumers at the moment, with many people being pushed into debt, ” she said. “If cutting back on things like car costs and non-essential spending is not enough, it’s time to seek expert debt advice.”
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Debt Advisers Direct offer a range of debt solutions, including debt management plans, debt consolidation and IVAs (Individual Voluntary Arrangements). To find out more, contact one of our expert debt advisers.
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