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

Lending Criteria Tightening

Saving for a deposit is the toughest hurdle for first-time buyers, according to financial data provider Moneyfacts as banks increase their minimum deposit from 5 percent to 10 percent. Those mortgage lenders who offered higher than 100 percent have now dropped their LTV to 95 percent.

Since December 2006, 11 mortgage lenders reduced the loan-to-value (LTV) they offer on their mortgage range. The 100% mortgage has almost disappeared completely from the mortgage market, and 130% is unheard of in today's mortgage market.

Moneyfacts claims that this is an "about-turn" from the pre-credit crunch, when a 95% LTV was the norm.

Northern Rock was widely regarded as the most aggressive lender in the 100%-plus market, with its "Together" product a favourite for struggling first-time buyers unable to save for a deposit.

Since Northern Rock's demise, other lenders have been rapidly withdrawing from offering 95% and 100% loans.

Scottish Widows, which specialises in mortgages for professionals such as doctors and lawyers, this month cut the maximum LTV available from 102% to 95%.

David Knight, mortgage analyst at Moneyfacts, said: "It is not hard to understand why this pattern has emerged. With mounting evidence that housing prices are cooling, combined with the increasing number of borrowers facing debt problems, it is not welcome news for those consumers with only a small amount of equity.

"This more cautious approach of lenders starting to reduce their exposure to the property price fluctuations shows they have a real concern over the future of the UK housing market. A case of negative equity is bad news for both the borrower and the lender."

Published on January 25, 2008

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