Repossession
Tagged: Mortgages, RepossessionThe latest reports from the finance market are unfortunately not a break from the drib and drab the credit crunch has turned it into. In fact, the latest news we’ve been handed is that in the second quarter of 2008 alone over 28 thousand people had their home repossessed within England and Wales. This is a staggering 24% more than it was just twelve months ago.
The worst part is that there is no sign of this trend slowing down any time soon. The experts from the Council of Mortgage Lenders have estimated that there will be 45,000 repossessions by the end of the year. These are the warning bells for those who are beginning to struggle now, be sure you get yourself an appointment to speak to a financial adviser as soon as possible.
Officials have said that they are making absolutely sure that there is an abundant amount of advice and support available to those struggling with mortgage repayments and are being hassled by lenders. It has become a worry for those helping people in trouble that the lenders seem to be swaying for repossession much faster than they used to.
Could it be lenders simply won’t spend the time giving people the chance to better their situations, and this is why the repossession rate has gone through the roof?
These experts have approached council lenders so that those on low in come that have mortgages have a better chance to recover from any financial problems they have before it is too late. However it is usually down to the discretion of the lending company as to when somebody is repossessed.
If you are getting into financial problems be sure you don’t leave the problem in the background. Don’t ignore letters or leave phone calls unanswered, as the lending company won’t just go away and they can use lack of response as evidence against you.
If you’re dreading hearing about mortgages see if you can get some advice. To see what your best mortgage decision is, try speaking to an advisor about repossession.
Tips for remortgaging in a credit crunch
Tagged: Finance, Loans, Mortgages, Repossession, UKIn the midst of the credit crunch, remortgaging can be a stressful experience for homeowners. The best interest rates are often only available if you are willing to pay a mortgage arrangement fee – and those on variable-rate mortgages can soon find their mortgage payments getting more expensive than they may have expected.
Lenders are being careful with their lending these days, but they are still being competitive. With that in mind, it makes sense to look around and ensure you are getting the very best deal on your remortgage.
Plan ahead
It’s essential you don’t leave your remortgage too late – any less than a month’s planning could leave you pressed for time. Ideally you should leave at least 2-3 months to go over your options, which gives you enough time to look at what’s available without rushing.
Find out all the costs involved
As with a new mortgage, there are many costs associated with remortgaging – so make sure you know exactly how much you are going to need.
Consider the mortgage arrangement fees associated with each deal. Many variable-rate mortgages come without an arrangement fee, but most fixed-rate mortgages do carry them. If you‘re willing to pay an arrangement fee, a fixed rate is probably worthwhile, since it gives peace of mind over how much you will pay each month, and can usually be added to your mortgage payments. However, if interest rates go down, you may end up paying more than you would with a variable-rate mortgage.
You will also need to consider any ‘additional’ services offered with your mortgage, particularly PPI (Payment Protection Insurance). If you can afford to pay the extra each month, PPI is worth having – if something occurs that prevents you repaying your mortgage, the insurance should cover your costs, often for over a year. If it’s going to be a burden on your finances, though, it may be worth waiting until you are in a better position financially.
Make sure you’re safe if your payments go up
This doesn’t apply to fixed-rate mortgages, since the payments are the same each month – but there is a risk with variable-rate mortgages that if the interest rate rises, so will your mortgage payments. Make sure you have room in your finances for any unexpected rises, and expect your disposable income to take a hit if they do.
Some lenders offer a ‘cap’ on their variable rates, which could help you plan for the worst-case scenario (i.e. rates are as high as they can go).
Check for early repayment charges
If you are hoping to pay off your mortgage early, some lenders will ask for an ‘early repayment charge’ (also known as a ‘redemption penalty’. The idea behind this is that it makes up for what the lender would have gained in interest, had you continued with the mortgage as normal. However, these most commonly apply during fixed rate or discounted rate periods and many lenders offer deals which don’t include such charges.
Avoid mortgages with annual interest
Some mortgages work out their interest on an annual basis, meaning the amount of interest you pay every month is based on the money you owe at the start of each year.
Mortgages with daily interest charge you interest depending on how much you owe at any given time, so as you pay off more of the mortgage, the interest decreases with it. This might not make a huge difference at the time, but over the course of your whole mortgage, you will end up paying a lot less in interest – and the mortgage can technically be paid off years earlier.
Guest Post by Melanie Taylor of www.ThinkMoney.com/
What is a priority debt?
Tagged: Debt, Finance, Repossession, UKPriority debts are your most important debts – ones which cover your essential costs of living. Your priority debts include: