Car Insurers Debate Over Future Profits

UK car insurers have been running an unprofitable business for 14 years. Independent market analysts, Datamonitor, say 2009 looks to be a profitable year despite the doubts

March 13, 2008

Budget Report Expectations

Chancellor Darling's Budget Report is expected to raise taxes on alcohol, fuel emissions, flights and many other issues concerning the economy. Tax burdens expected to increase on poorer families

March 12, 2008

Card Fraud Rises Again

Card fraud has increased over past year. Whilst chip and PIN technology has been successful in the UK, criminal activity overseas has increased 77 per cent

March 12, 2008

Tax Cuts Needed To Restore Confidence

Appeals for corporate tax cuts are submitted to the Treasury as it prepares its Budget report this Wednesday. Business and banking sectors are worried about the direction of the UK economy

March 10, 2008

First Time Buyers Take Hit From Stamp Duty

Stamp duty tax has not kept up with the rate of increase in house price inflation over the past decade. Yet another hurdle first-time buyers must leap over to get on the property ladder

March 10, 2008

Read all Finance News

Is The Crisis In The Mortgage World Over?

Last week proved to be a volatile one for the UK mortgage market. Mortgage companies are finding it difficult to raise money even to lend to sound borrowers, despite a pledge by the US government to help, and the Bank of England helping Northern Rocks, house building is at a record low, according to BBC news.

"It's been a rocky week for Britain's retail banks and their customers," said James Edsberg, a partner in the retail strategy firm Lighthouse Global. "The Northern Rock bank has been the first to suffer from the impact of the global credit crunch on this side of the Atlantic."

Mortgage companies worldwide are finding it difficult to raise funds. Northern Rock is no different than hundreds of other banks, except that their plight hit the media at a vulnerable time. The governor of the Bank of England is under scrutiny for not intervening earlier to prevent the Northern Rock crisis from spiralling out of hand.

However, some analysts are reporting to various media venues that this is merely a balance. The BBC reports that many economists believe that the crisis is also an opportunity for rebalancing the economy, which has become overly dependent on consumer spending financed by cheap credit and government borrowing. An increase in household savings, encouraged by higher interest rates for savers, could lead to more long-term investment.

This balancing was predicted more than a year ago both in the credit management circles and property investment circles. These industries relied on the balancing to stabilize their industries and solidify investments. While a balancing will devastate many, it is no surprise to those who have been warning people for the last year to avoid expensive mortgages and easy to apply for mortgages.

There are several factors to be considered before deciding if the crisis is over. First, governments must make it easier for mortgage lenders to receive money. Second, they need to build confidence in depositors so they leave their money in the banks. If these two things happen, then the banking industry should recover swiftly. At the moment, they are not struggling for survival, but are fighting to maintain projected profits.

Published on September 30, 2007

Darling's Budget Report Highlights

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Lending Falls Again Says CML

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10 Tips To Improve Your Credit

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March 7, 2008

Interest Rates Kept At 5.25%

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March 7, 2008

20 Per Cent Of Homeowners Fear Repayments

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March 6, 2008