tag:www.moneyoutlet.co.uk,2008://3 2008-03-13T17:01:11Z Saving You Money With One Click! Movable Type 3.35 tag:www.moneyoutlet.co.uk,2008://3.502 2008-03-13T11:52:31Z 2008-03-13T17:01:11Z

Chancellor Alistair Darling delivers his first Budget Report yesterday. Highlighted in this article are some of the main points

Scott Inman http://www.moneyoutlet.co.uk/ Highlights of Chancellor Darling's first Budget Report aimed at raising taxes on high-polluting cars, cigarettes, alcohol whilst aiming to help poorer families and pensioners. Lifestyle Tax

• Pack of 20 cigarettes - up 11p
• Pack of 5 cigars - up 4p
• Beer - up 4p a pint
• Wine - up 14p a bottle
• Spirits - up 55p a bottle
• Cider - up 3p a litre

Taxes on alcohol will go up by 2% above inflation over the next 4 years. These taxes on alcohol are expected to bring the government £1.5billion over the next three years. Cars and Travel

• 2009 expects to see vehicle excise duty reformed
• 2010 - Lowest emission new cars pay no road tax in first year, highest polluting new cars pay £950
• Fuel - 2p increase on petrol now held back until October this year and rising 0.5p per litre in 2010
• Air Travel - New measures at Heathrow to help speed up time it takes to go through security checks
• Greener Travel - Extra 10% on plane duty. Airlines will have to pay more to become "greener"

Housing and Property

• £8billion dedicated to new, cost effective housing
• Stamp Duty - In shared ownership schemes, no stamp duty until occupant owns at least 80%
• Mortgages - Efforts into how long-term fixed rate mortgages can help first-time buyers get on and stay on the property ladder
• Council Tax - Rises of 3.9% from April this year
• Housing - New sites have been identified for 70,000 new homes
• Key workers - Help for key workers, e.g. teachers and nurses, to borrow money on shared equity schemes

Pensions, Savings, Family Investments

• Pensioners over 60 will receive a £50 increase in winter fuel allowance from £200 to £250 and from £300 to £400 for pensioners over 80
• Savings Gateway - A savings scheme for those on lower incomes to be launched by 2010.
• Cash ISA limit to increase to £3,600 starting in April to encourage people to save.
• Child Poverty - The government plans to invest an additional £125 million over 3 years to help stop child poverty.
• Child Benefits - Starting in April 2009, child benefits will increase to £20 for the first child and an additional £50 will be added to child tax credit, above inflation, for lower and midde-income families.

Education, Poverty, and Public Spending

• £200m additional spending to improve GCSE results.
• £30m fund to improve teachings of science
• Public Spending - will increase 2.2% in the next 3 years
• British Troops - £2b more to be spent in 2008 with £900m on equipment
• NHS - The next decade will focus on making the NHS a world class service
• Poverty - Goal to eliminate poverty in the UK by investing an extra £125m over 3 years
• Poor families with one child will receive a further £17 per week
• Family with 2 children and earning up to £28,000 per year will receive and extra £130 per year
• Millions of customers on pre-paid meters expected to get a better deal

Environment

• Supermarkets will be taxed on plastic bags by 2009 if they do not do more to reduce their use
• Make Homes Greener - £26m to help families cut fuel bills
• Non-Domestic Buildings - Zero carbon for non-dom buildings by 2019
• Emission Cuts - Target to cut emissions 80% by 2050
• Climate Change - Levy to rise alongside inflation

Economy

• Growth Forecasts - 2008 set between 1.75% and 2.25%; 2009 between 2% and 2.25%; 2010 between 2.5% and 3%
• GDP - Goal for growth between 2.25% and 2.75%, same expected growth between 2008 - 2010
• Borrowing - Increase from £38b to £43b this year, equivalent to 2.9% of national income with an expected decline to £23b or 1.3% by 2012/13
• Total Borrowing - £140b over the next 4 years
• Public Spending - Increases in public spending up 2.2% per year

Corporation Tax

• Small Business - Corporation tax to rise to 21% in 2008-09 then rise to 22% the year after
• Skills - £60m dedicated to "skills gap"
• Funds - Small business funding will increase by £60m
• Women Entrepreneurs - Capital fund of £12.5m aimed to encourage more women entrepreneurs
• Tax - Capital gains tax will be charged a flat rate of 18%

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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

Scott Inman http://www.moneyoutlet.co.uk/ car insurance companies making a profit in 2009, according to the Telegraph. Despite motor insurance premiums kept under pressure due to fierce competition, providers are feeling optimistic about the future profitability in the UK market. ]]> Datamonitor , an independent market analyst, reported by 2009 they expect to see £30m of underwriting profits for UK car insurers. The AA insurance, on the other hand, say they see no signs of claim costs reducing, which is a major factor if the industry is to meet this optimistic target. The AA believes they would have to raise premiums by 20 per cent over the next 2 years to reach a profit. Last year, according to the AA, £112 was paid out in claims compared to £100 coming in for premiums. The Chief Executive of AA Insurance said, "Online buying means that buyers are much more likely to shop around for car insurance and buy on price. That is keeping premium rises in check. "So far this year we have not seen industry premiums rise by anything like the amount that would make the industry profitable. It remains a very volatile and competitive market, and we don't see that changing in the immediate future." Datamonitor’s report is much more optimistic for 2009 however, curiously they then forecast this profit honeymoon to return once again to a loss in 2010 due to increased competition. Andrew Haslip, Datamonitor's financial services analyst, says when consumers shop for car insurance they make their decision largely based on price, especially those who compare online. ]]> tag:www.moneyoutlet.co.uk,2008://3.500 2008-03-12T12:35:18Z 2008-03-12T12:48:17Z

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

Scott Inman http://www.moneyoutlet.co.uk/ BBC News report Chancellor Darling is expected to increase taxes on alcohol, high polluting cars, and possibly a tax on flights.]]> Telegraph.co.uk, middle class families are already paying an extra £1,250 per year after a sharp rise on their tax bills. This increased tax burden is said to be the highest rise in any leading Western country in the past 5 years. Comprehensive research shows that middle class families in Britain are paying £1,243 more on their tax bill than in 2002, based on a median yearly wage of £19,856. Today's Budget Report expects to see the Chancellor actually raise the tax burden for millions more families. The Telegraph says measures introduced by Gordon Brown are set to be confirmed today which will raise taxes on the poorest of Britain’s households. Shadow Chancellor George Osbourne said, "Here is proof that while the rest of the world is successfully reducing the burden on families, Alistair Darling and Gordon Brown are doing the exact opposite."]]> tag:www.moneyoutlet.co.uk,2008://3.499 2008-03-12T12:22:35Z 2008-03-12T12:33:15Z

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

Scott Inman http://www.moneyoutlet.co.uk/ APACS). Figures released today show that in 2007 total card fraud losses amounted to £535.2m, a rise of 25 per cent in the past year. ]]> One of the main contributing factors lies outside the UK. There has been a 77 per cent increase (up £90.5m) in overseas fraud committed by criminals who have obtained stolen UK card details. This is happening in countries that have yet to adopt the chip and PIN security system. Over one third of card fraud loss is now happening overseas. APACS’ Director of Communications, Sandra Quinn, says, “Although card fraud levels have now begun to go up again due to fraud abroad and card-not-present fraud losses, chip and PIN has proven to be an undoubted success in reducing card fraud on the UK high street.” As mentioned earlier, fraud overseas accounts for a 77 per cent increase whilst UK fraud figures report a 6 per cent rise. UK cash machine fraud has dropped by 44 per cent and mail non-receipt fraud has also dropped, down 34 per cent. On the other hand, phone, internet, and mail order fraud or “card-not-present” has risen by 37 per cent and counterfeit card fraud has risen by 46 per cent. Despite total figures for UK fraud in 2006 being £309.9m, down from £356.6m in 2005, there was still a 6 per cent rise in overall card fraud in 2007 at £327.6m. It is believed that once other countries adopt similar card protection technology, as we have here in the UK, fraud loss numbers are expected to decline. Sandra Quinn of APACS goes on to say, “And, as more countries follow our lead and upgrade to chip and PIN, the opportunities for criminals to use our stolen magnetic stripe details overseas will decrease.” tag:www.moneyoutlet.co.uk,2008://3.498 2008-03-12T12:10:34Z 2008-03-12T12:21:44Z

The amounts borrowed by first-time buyers and home movers continue to drop as the credit crunch takes further grip on the UK mortgage market. Remortgage activity is on the increase as many switch from fixed-rate deals to tracker mortgages in anticipation of further base rate decreases from the Bank of England

Scott Inman http://www.moneyoutlet.co.uk/ CML) yesterday released data showing how the ongoing credit crisis is affecting the mortgage market. Borrowers have fewer options today and as a result are borrowing less. ]]> remortgages took place in January compared to 59,000 in December - a rise of 43%. As consumers anticipate further base rate cuts from the Bank of England, many have switched from fixed-rate mortgages to tracker mortgages. CML's Director General, Michael Coogan, said, "The wholesale funding markets remain largely closed and mortgage funding still remains constrained. This is now having a discernible impact on lending criteria and the ability of first-time buyers to get into the housing market. "Tomorrow's Budget presents a perfect opportunity for the government to do what it can to help first-time buyers by raising the stamp duty threshold." Figures from the CML show only 39% of first-time buyers avoided paying stamp duty tax in January yet 11% were charged as they bought homes in higher tax bands. These numbers have risen significantly for first-time buyers compared to January 2006 where 53% avoided stamp duty tax and only 6% were stuck with the higher banding bill.]]> tag:www.moneyoutlet.co.uk,2008://3.497 2008-03-10T11:40:30Z 2008-03-10T11:52:38Z

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

Scott Inman http://www.moneyoutlet.co.uk/ CBI) is calling on Chancellor Darling to cut business taxes as they are damaging the UK economy. This demand to reduce taxes is aimed at restoring confidence in the UK Government which has since deflated due to the Northern Rock fiasco and changes to capital gains taxes. ]]> BBA) is echoing similar concerns within the financial services industry. In its official submission to HM Treasury regarding this week's Budget report (due on 12th March), BBA members are worried about international businesses reconsidering the UK as a location of choice. The Chief Executive of the BBA, Angela Knight, called on Chancellor Darling not to hesitate in attracting more business to the UK when considering the Budget. She warned there is strong competition from other centres and for the past quarter century the UK has been known "as a well-regulated location with a favourable tax regime for the financial services industry". However, these advantages are now being questioned. Failing to act now could hurt the economy and in particular the global banking industry outside the UK. Mrs Knight, continues: "Taxation is not simple, and changes cause unintended consequences. Closer collaboration with the industry is essential to avoid giving our partners and competitors abroad the impression that the UK is not as friendly to business as it was just a few years ago."]]> tag:www.moneyoutlet.co.uk,2008://3.496 2008-03-10T11:31:19Z 2008-03-10T11:39:46Z

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

Scott Inman http://www.moneyoutlet.co.uk/ mortgage deals were aplenty as lenders competed for business by offering as much as 125% mortgages, whereby one could borrow more than the asking price to potentially pay for furniture or a remodel of their first property. ]]> BBC News, the average stamp duty bill has almost doubled for first-time buyers since 2002. The Treasury says that half of first-time buyers will not have to pay any stamp duty tax this year. In order to qualify for no stamp duty the purchase price of a home must be valued at below £125,000. At the moment, homes valued between £125,001 and £250,000 will require the buyer to pay a 1% stamp duty tax. Homes valued between £250,001 and £500,000 command a 3% tax and those above half a million pounds will require a 4% tax. The problem for many first-time buyers is that these thresholds have not kept pace with the increase in house price inflation over the past several years. According to Martin Ellis, Chief Economist at Halifax, he states: "Stamp duty has again become an issue for first-time buyers because the stamp duty thresholds have not kept pace with house price inflation. "We call on all political parties to raise the stamp duty thresholds to compensate for house price inflation over the past decade." Although the Treasury iterated that half of first-time buyers will not have to pay Stamp Duty Land Tax this year, it is important to remember that in order to qualify for "no tax" one must purchase a home that is valued below the £125,000 threshold, otherwise expect to pay a minimum of 1%.]]> tag:www.moneyoutlet.co.uk,2008://3.495 2008-03-07T09:59:30Z 2008-03-07T10:28:03Z

Now more than ever our credit rating affects our ability to borrow credit. Here are 10 tips to help you improve your credit score

Scott Inman http://www.moneyoutlet.co.uk/ mortgage in order to buy a house, a credit card for that much needed holiday or a personal loan to finance a new car. Each time we apply for credit the lender will run a check on our credit history, a process known as credit scoring, to determine whether or not we are a suitable candidate for the loan.]]> Experian, Equifax and CallCredit. Our credit files contain personal information such as our name, date of birth, current and previous addresses, partner’s details and any information publicly available from the electoral roll, court judgements and details of bankruptcies. Details of our current and previous financial accounts, credit applications both approved and denied, how much credit we have available and what we have outstanding collectively form what is known as our credit and financial history. Those with good credit histories are more than likely to score high and be granted credit upon application. Those unfortunate enough to have a low scoring credit history may be offered credit at higher interest rates or quite simply refused credit in the first instance. As a result of the credit crunch, lenders are significantly tightening their lending criteria in order to reduce the number of ‘high risk’ customers they take on. Although it is becoming increasingly difficult to be granted credit, there are a few steps we can take to avoid the frustration and inconvenience of being turned down. Listed below are 10 ways which could help you improve your financial standing:

1. Obtain a copy of your credit report and check it for regularly for any errors:Under the Consumer Credit Act 1974 you have a right to see a copy of your file. All 3 credit reference agencies will print out a copy of the personal information contained in your credit file for a charge of £2. Check your file for any errors which could be present as a result of fraud. Check that any completed payments are noted as closed accounts and check for anything that looks suspicious.
2. Make sure you are on the electoral roll:Information about you contained on the electoral roll is obtained by credit reference agencies. It is important that you are listed on the electoral roll otherwise you will appear either to not exist or to be starting fresh with no credit record. Register with your council as soon as you move house. Since credit reference agencies update their details on a monthly basis, registering as soon as possible will only improve your credit score.
3. Check that you do have a credit record:If you have never borrowed money it may go against you. Credit companies prefer to see how you handle money and how you manage repayments. It is a good idea to open an account of some kind such as a basic bank account in order to establish a credit history.
4. Check your bank statements:By regularly checking your bank statements you can keep track of any missed payments. It will also help you detect any suspicious transactions that may be fraudulent and ultimately affect your credit rating.
5. Set up standing orders and direct debits:By setting up standing orders and direct debits for payment of monthly bills it will prevent any missed payments that may escape your memory. Some companies will offer discounts on your bill for this method of payment.
6. Cancel any credit card accounts you no longer use as well as any extended overdraft facilities:When you apply for credit, lenders will check how much credit you already have available to you. If you are applying for a new credit card, because it offers a better rate, remember to inform the old credit card company that you wish to close the account. The more credit card accounts you have can go against you and put you in the high risk category.
7. Do not have multiple credit applications at any one given time:Remember that each time you apply for credit, the company will check your credit record and leave a footprint. Too many footprints can be interpreted as a sign you are at risk of running into debt.
8. If possible pay off any loans or credit arrangements before the deadline date:Early settlement of a loan or credit arrangement is taken as a positive sign by financial organisations and will make them more inclined to offer facilities in the future.
9. Make sure any arrears are up-to-date with a notice of correction included explaining the situation:Any evidence of missed or late payments present in your file will work against you or result in much higher interest rates being offered should your credit application be approved. If you have missed any payments or fallen behind, make sure you include a note explaining the reason why. It could make all the difference when it comes to obtaining future credit.
10. Check that any accounts you have settled are clearly shown on your credit file:Any past financial problems that have since been settled must be noted on your credit record. In the case of CCJ’s you may need to obtain a Certificate of Satisfaction from the county court which you must then send off to the credit reference agency. Your file will then be brought up to date and all settlements duly noted. This in turn will improve your credit rating and work in your favour.

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Yesterday, 6th March, the MPC decided to keep the base rate at 5.25 per cent. This decision was to be expected as the Bank focuses on the pressures of rising inflation and a slowing economy. Analysts are predicting another cut to 5 per cent to happen in May unless economic conditions weaken substantially. Whilst some feel the MPC shouldn't wait too long before the next cut, many agree with yesterday's decision

Scott Inman http://www.moneyoutlet.co.uk/ MPC) has opted to keep interest rates on hold at the current rate of 5.25%. ]]> CIPS) showed that the price of UK manufacturer's products had risen in February to its highest level in eight years. Despite recent figures for the UK economy indicating a 0.6% upward turn for the last quarter of 2007, consumer spending underwent a considerable decline for the same period. In addition, Halifax, the UK's largest mortgage lender, said that house prices up and down the UK were continuing to slow. The overall opinion is that the interest rates will remain as they are at least until May, with forecasts of a drop to 5%. Howard Archer of Global Insight, the 'global leader' in economic and financial analysis, said: "A move in April cannot be ruled out, but it would probably only occur if economic data deteriorate markedly over the coming weeks." Likewise a spokesman for the Royal Bank of Scotland said: "We expect one more rate cut this year, most likely in May, unless economic conditions weaken substantially." But mixed reactions were also voiced following the MPC's interest rate decision. Economic adviser to the British Chamber of Commerce Mr David Kern has called on the MPC not to prolong a further cut until May but to bring it forward to April. He said: "The decision is not surprising, but we believe the decision is mistaken, given the worsening international and domestic situation." He added, "We do not disregard the inflationary risks arising from surging food and energy prices, but countering the immediate acute threats to growth must be given a greater priority." Both the EEF manufacturer’s organisation and the Institute of Directors welcomed the MPC's decision to hold back. Graeme Leach, chief economist for the Institute of Directors said: "It comes as no surprise and wise. The last thing the economy needs is for an overly aggressive easing in policy now, which has to be reversed later in the year. Unless the evidence shows the economy slowing faster than expected, the Bank should continue to reduce rates gradually."]]> tag:www.moneyoutlet.co.uk,2008://3.493 2008-03-06T12:09:20Z 2008-03-06T12:19:43Z

Yesterday saw the pound drop against the Euro which rose to its highest ever rate since it was introduced back in 1999. The pound also fell to a one-week low against the US dollar

Scott Inman http://www.moneyoutlet.co.uk/ ]]> credit card companies and mortgage lenders are now either cancelling their 'high risk' customer's accounts or dropping the products that may put them at risk. Despite the Bank of England's Monetary Policy Committee (MPC) meeting today, 6th March, to discuss the interest rates, any further cut looks highly unlikely. Worries about inflation continue to outweigh concerns about the flagging housing market. The current base rate stands at 5.25% following the MPC's decision to cut rates twice in the past four months. An economist said the Bank would eventually cut the interest rates but not yet. He said, "We judge that the growth outlook will prove to be the bigger concern for policymakers but, in the very near term, the upside inflation pressures could dominate, consistent with a no-change decision at this week's MPC meeting." Analysts predict the Bank's policy makers will reduce the borrowing cost an additional 3 more times to 4.5% by the end of the year as economic growth slows. However, it is clear that the pace for any further reductions will be delayed by rising food and energy prices since the MPC’s main point of focus is that of inflation.]]> tag:www.moneyoutlet.co.uk,2008://3.492 2008-03-06T11:53:28Z 2008-03-10T11:30:46Z

Rental expectations remain high in the uncertainty of hte housing market and established investors are reaping the rewards. Those newly seeking to become landlords are struggling with shrinking mortgage availability

Scott Inman http://www.moneyoutlet.co.uk/ RICS), demand for rental properties continues to grow as yields increase for landlords. More would-be first-time buyers are either unable or hesitant to enter the property market in today's economic climate. ]]> investment mortgages and benefit from the rising rental market. According to RICS data, "1% more Chartered Surveyors reported a fall than a rise in landlord instructions compared to 11% in the previous quarter. "The credit crunch has restricted the number of buy-to-let mortgages approved as well as the number of mortgages available to investors." Rental expectations continue to be positive and rising yields may be the reasons landlords remain in the market. Property investors selling off their properties after tenant leases expire has fallen almost 2%. Barry Hall, an RICS spokesperson, said: "Established investors continue to reap the benefits of the current uncertainty in the housing market and have been enjoying the fruits of rising rents, but new investors are struggling to get the necessary finance to enjoy this buoyant sector. However, some landlords at the margins may desert the market after the drop in capital gains tax occurs in April."]]> tag:www.moneyoutlet.co.uk,2008://3.491 2008-03-06T11:27:12Z 2008-03-06T11:58:24Z

The UK's financial watchdog, the FSA, published a survey of over 500 mortgage holders which revealed 1 in 5 are worried about being unable to keep up with their mortgage repayments. It is estimated that 1.4 million fixed-rate or discount deals will expire this year raising monthly repayment amounts. Twenty five per cent of those surveyed admitted they had no contingency plans to meet these costs

Scott Inman http://www.moneyoutlet.co.uk/ FSA) said that 1 in 5 homeowners are worried about being able to make their mortgage repayments over the next 12 months. One quarter of those asked about how they would meet these costs said they had no plans. ]]> mortgage for their needs. The Bank of England has now dropped the base rate twice in the past 3 months. Despite this, nearly one and a half million short-term fixed-rate or discount mortgages will end this year raising repayments to potentially unaffordable levels. Rising energy and food prices are already affecting tight family budgets causing concern as to whether or not homeowners will be able to make their repayment obligations. The FSA's Director of Financial Capability, Chris Pond, said, "Economic conditions are getting tougher, putting pressure on family finances. As the UK's financial watchdog we can help. Our new checklist sets out simple steps that homeowners can take to manage their money and mortgage in difficult times. "And for those who are really struggling, don't panic. Talk to your lender or get free, confidential debt advice." A checklist has been published by the FSA to help homeowners manage their mortgage if times become too difficult. To begin with, here are a few recommendations:

• Check your budget: If you are on a fixed-rate deal now, think about how would cope if your repayments increased significantly
• Start planning now: Speak with your lender and compare mortgage products if you decide to remortgage
• Get help and advice: If you start falling behind in your payments, don't panic. Talk to your lender straight away and consider getting free, confidential advice from an independent debt advice agency.

If you realise your fixed-rate is ending soon, be prepared. Ask your lender what your new monthly repayment amount will be at the end of the fixed or discounted term. Decide if you can afford these higher payments and if not, be sure you already have a plan to make up for the additional costs. ]]> tag:www.moneyoutlet.co.uk,2008://3.490 2008-03-05T11:52:21Z 2008-03-05T12:05:02Z

A proposal has been made for a free national advice service to help UK residents take better care of their finances in the 21st century

Scott Inman http://www.moneyoutlet.co.uk/ ]]> Financial Services Authority (FSA) imposes on businesses it regulates in the credit industry and National Savings & Investments.]]> tag:www.moneyoutlet.co.uk,2008://3.489 2008-03-05T11:30:22Z 2008-03-05T11:47:08Z

As more 100%-plus mortgage products are being pulled off the shelf, first-time buyers are finding it increasingly difficult to borrow. Some critics feel this will further weaken the UK housing market

Scott Inman http://www.moneyoutlet.co.uk/ mortgage deals from the property market, leaving first-time buyers stranded. ]]> Hamptons Mortgages in particular has slammed the decision to scrap such mortgage packages, which offered the only opportunity for struggling first-time buyers to step foot on the property ladder. Managing director, Jonathan Cornell, of Hamptons Mortgages claims the disablement of first-time buyers to afford property will only contribute to the already weakening housing market in the UK. He said: "In the light of the weakening housing market, lenders are pulling their 100%-plus LTV mortgages at a rate of knots. It is a real shame to see so many products being removed from the market as in the current economic situation, these provided the only real hope for struggling first-time buyers." The average UK house price is now far greater than the average salary, particularly that of the average young first-time buyer. Those unable to come up with a deposit previously relied wholeheartedly on the funding a 100%-plus loan-to-value mortgage provided. Now the prospect of becoming a homeowner looks grim as without a deposit not only are there fewer options available, but also the first-time buyer will be forced to pay a much higher premium for the added risk that the lender is taking on. Cornell added: "Unfortunately, the disappearance of so many 100%-plus LTV mortgages from the market will make it even harder for first-time buyers to purchase a property and in turn, this may continue to weaken Britain's already fragile housing market." One by one mortgage lenders are now rapidly withdrawing in the aftermath of the credit crunch, compared to last year which saw them falling over one other in order to enter the market. "I hope that once the credit crunch is over and the fears over house prices subside, that we see these popular mortgages re-introduced," said Cornell. ]]> tag:www.moneyoutlet.co.uk,2008://3.488 2008-03-05T11:12:23Z 2008-03-05T11:29:04Z

Recent research into the credit card market suggest an increase in the number of people being rejected when applying for a new credit card. It is believed 1 in 10 will automatically be turned down as banks try to protect their bottom line.

Scott Inman http://www.moneyoutlet.co.uk/ ]]> Egg cancel the accounts of 161,000 customers believed to be high risk. In turn this has triggered off much speculation regarding profit making and losses with customers sparking rumours that their accounts have been terminated simply because there is little profit in customers who pay their balances in full and on time. Meanwhile a separate report has shown that banks are nevertheless gaining in excess of £530 million in profits from extra fees charged on credit cards, which just so happen to have gone up. It is estimated that these fees, which generally exist without being underlined or highlighted, equate to around £17 for every credit card customer in Britain. According to one financial website, the number of denied credit card applications rose by 17% over the past 6 months. A spokesperson said: "Credit card companies have had a rough ride with bad debt so it's no surprise that they are becoming stricter on who they'll lend money to. And with so many of us feeling the pinch following five interest rate rises since last year, credit is undoubtedly harder to come by than it has been for a long time." Following the global credit crunch it has become considerably more expensive for finance houses to borrow from one another. Many banks have consequently seen their profits come under substantial pressure and as a result are forced to recoup these lost revenues by seeking out new means. The principal formula which has been introduced, alongside eliminating 'non-profitable customers', seems to be that of hiking fees on other available products or product features. The research carried out showed that the biggest fee incurred by customers is that attached to the 0% on balance transfer offers. This particular offer allows customer to switch debt on to a new card and not be charged any interest for a fixed period of time, usually 6 months. To many this may sound like a good deal, but what many customers fail to see is the handling fee charged for actually transferring funds over. In the last 2 years this fee has been increased four-fold, from a mere 0.59% to a current average of 3%. Therefore anyone transferring £2,000 for example, would be faced with a fee of £60 which would be added to the outstanding balance. In addition, many credit card companies have increased their charges for cash withdrawals while others are considering bringing back an annual cardholder fee. ]]>