Adverse Mortgages UK

People who have taken out loans could find that they are at risk of repossessions as service providers adopt new measures, it has been claimed.

Thomas Charles, a debt consultancy, said that credit card companies are increasingly beginning to "take charges over property" when consumers cannot repay arrears.

Such firms may apply to a court to get existing debts secured against homes as they attempt to reclaim money, stated managing director at the outfit James Falla.

He commented: "So that, potentially, is a longer-term consequence of the situation we've got and one that is perhaps a bit more serious than it has been in the past."

This is a trend that it starting to become a lot more common, the outfit added, as more stringent means are attempted.

In 2007, five per cent of consumers who took out credit cards admitted to lying about how much money they earn, according to uSwitch.com.

 

First-time buyers who cannot afford to get onto the property market should wait and see while prices "correct", it has been suggested.

According to Firstrung, these buyers should save so they can afford a mortgage at the bottom of the ladder, if this is an impossible task at present.

Operations director at the company Paul Holmes noted that these consumers ought to be "confident" because prices are dropping all of the time.

He said that the market must revert to a "normal historical trend" eventually in terms of cost, so first-time buyers should not despair too much.

"At the moment with prices falling you are safe in knowledge that you are not missing out on anything, the market is not racing ahead," he commented.

The National Housing and Planning Advice Unit has said that affordability will not be aided even if prices drop by ten per cent in 2009 and five per cent this year.

 

Buy-to-let landlords ought to make sure that they properties they invest in are presentable for people looking around.

The Residential Landlords Association urged those holding an investment mortgage to make amendments to key areas of these homes, such as kitchens and bathrooms.

Director at the organisation Alan Ward remarked that it is a competitive marketplace and therefore landlords should be able to pick out the best tenants when they look around.

He asserted: "Don't do a Llewellyn-Bowen or fit it out like your second home - it's a business package, not a showplace."

While in the past laminate floors were popular in this marketplace, in recent times tenants have begun to realise that it is noisy beneath them.

But kitchens and bathrooms are used the most by those living in rented accommodation, he remarked, which means they need to be attended to.

The Residential Rental Price Index in Febraury this year said that the average price of a rental property stood at £608.

 

People are struggling to pay back loans because money is handed out too easily to them by service providers, it has been claimed.

Consultancy Thomas Charles noted that this has been happening for a long time and consumers get hit with debts because checks are not stringent enough.

Yet in the present economic climate, it suggested, it is harder for individuals to give back the credit because of the rising price of essential living costs.

As a result, people are getting more credit, with a card being used in order to repay other loans that they already have, managing director James Falla asserted.

He commented: "I think that kind of thing is just going to continue and we will see perhaps more people not being able to repay the money they have borrowed."

Mr Falla added that in past times banks have not got their money back due to the leniency of the criteria they have in place.

Just eight per cent of people were asked last year to provide details of their income when applying for credit, uSwitch.com has said.

 

House prices are continuing to fall in the central London area due to more widespread problems in the market, it has been revealed.

Knight Frank noted that homes now cost 3.1 per cent lower than they did there three months ago, which is the largest drop the company has ever recorded.

And the organisation added that homes are only 7.5 per cent more expensive than they were 12 months ago, the smallest yearly increase since November in 2005, something that might interest those looking for a mortgage.

Head of residential research at Knight Frank Liam Bailey said that the trends have taken place for a number of reasons.

"[It is a] result of the tightening market for mortgage finance and a crisis in confidence in the housing market," he commented.

He added that if the economy slows down in the next half of the year, then the problems are likely to be seen throughout 2008.

Nationwide revealed this week that in June house prices fell by an average of 0.9 per cent.

 

Personal debt problems - including those created on personal loans - in the Bradford area are increasing as people struggle during harder economic times, it has been revealed.

According to Citizens Advice Bureau, the level of debt there has hit £15 million, with the cost of everyday life exacerbating matters, reports the Telegraph and Argus.

In response to the findings, supermarkets in the region stated that they will be looking to lower prices in an effort to help out stretched consumers.

Group trading director at Morrisons Martyn Jones argued that people can save "millions of pounds" thanks to cut prices.

"This is about the bigger picture - offering our shoppers great all-year-round value across the whole weekly shop," he told the news source.

The Consumer Credit Counselling Service stated that it would "welcome" any changes as these could have a positive impact on individual's finances.

In recent times the Conservative Party has said that it will look to reduce the large-scale debt racked up by British consumers.

 

Service providers handing out credit cards should make more stringent checks to ensure that borrowers can pay money back, it has been suggested.

Debt consultancy firm Thomas Charles commented that people taking out plastic loans are rarely asked provide evidence of how much money they earn.

And as a result, claimed managing director at the company James Falla, it is relatively easy for people to get into avoidable debt.

He suggested that lenders ought to change matters and there should be a "tightening up" of criteria they have in place.

"Maybe some more investigation about what people can actually afford would be a way forward," he commented.

But he said that in the past firms have not altered their ways because it would cost them a fair amount of money.

Recent research undertaken by uSwitch.com found that 14 per cent of those with credit cards had not been asked to supply any information about their salaries.

 

In June, the price of a house on average dropped by 0.9 per cent, according to new figures published by the Nationwide, news that may interest those wanting a mortgage.

According to the building society, property prices are now also 6.3 per cent below where they were one year ago, even though Scotland defied the slowdown.

Chief executive at the Nationwide Fionnuala Earley said that it is unlikely that there will be a great positive change in the months ahead.

But she suggested that it will become easier for some buyers as prices in the market continue to drop.

"As prices continue to fall affordability measures become more favourable for those in a well-financed position to buy," she commented.

Moreover, annual growth levels in Scotland stood at 0.6 per cent, it highlighted, because higher oil prices have had a good impact on some regions there.

Yesterday, Hometrack claimed that house prices have dipped by 3.2 per cent in the last year.

 

Fraud is on the increase as people see their debts rise during the present credit crunch, it has been claimed.

According to BDO Stoy Howard, in the last six months business fraud has jumped by 74 per cent, with staff members taking money from their places of work.

Simon Bevan from the organisation suggested that as times become harder for consumers they are looking for other ways to generate cash, news that might concern those with personal loans.

And he added that unless businesses realise what is going on quickly then the trend will continue throughout the year.

"Commercial organisations of all types and size throughout the UK are failing to get to grips with the fraudulent activity of their staff," he commented.

The financial sector was the worst hit in the first six months of the year, the firm said, as 90 per cent of all cases were seen here.

Last week, the Times found that a growing number of people are relying on payday loans because their money is running out before their salary is handed to them.

 

House prices in the UK dipped again in June, figures published by the research firm Hometrack have stated.

The outfit said that year-on-year property prices are down by 3.2 per cent, while they were one per cent lower than the previous month.

Director of research at Hometrack Richard Donnell added that registrations of new home buyers have also diminished by 5.7 per cent during the month, news that may concern those with a mortgage.

He commented: "The net result is a sizeable drop in transaction volumes which look set to reach levels not seen since the 1970s."

And unless confidence is "restored" to the market quickly, he noted, then such falls are probably going to continue.

It now also takes an average of 10.3 weeks for a property being placed on the market to be sold, Hometrack revealed.

The National Landlords Association last week said that improvements to areas such as bathrooms and kitchens can make homes more attractive.