Glitec Loans » mortgage rescue plan

NCC cuts ties with doorstep lending site

admin — Wed, 31 Dec 2008 08:00:14 +0000

The National Consumer Council, which was recently renamed Consumer Focus following a merger, has reported that it is not part of a relatively new website that was set up to help consumers find the cheapest doorstep lenders. The reports indicate that the consumer watchdog is trying to distance itself from the website, which was set up earlier this year by the Competition Commission to help people to find the most competitive doorstep lender in a climate where an increasing number of consumers have had to turn to these lenders.

Doorstep loans generally come with an extortionate rate of interest attached, and this resource was aimed at making it easier for consumers to find a more competitive doorstep loan for their needs. Consumer Focus, which was then known as the NCC or National Consumer Council, was one of its supposed partners, but it has now stated that it does not want any association with the site. The NCC had originally complained that there was no facility for consumers to compare doorstep loans and the website had been set up in response to this.

The website of the comparison site said that it is ‘operated in partnership with organisations including the National Consumer Council, Association of British Credit Unions, the Consumer Credit Association and other representatives which are independent of the home credit sector’.

However, an official from Consumer Focus said: ‘We don’t know how our name got in there. They are obviously trying to associate us with their work. We’re not against doorstep lending per se, but we believe there is not enough competition in the market. We recognise it is an important source of credit for some people but we want a competitive lending market, which it is not at the moment. Some of the rates charged on this site make it extortionate.’

NCC cuts ties with doorstep lending site is a post from: Glitec Loans

Government rescue plan may take time to take effect

admin — Wed, 11 Jun 2008 07:49:49 +0000

According to industry officials the recently launched government mortgage rescue plan could take some time to take effect, and in the meantime the mortgage sector will continue to remain inaccessible and expensive for many consumers. The £50 billion plan was launched by the government recently in a bid to increase confidence amongst lenders in order to encourage them to lend to one another at affordable rates, which in turn could help to increase liquidity.

The plan will enable mortgage lenders to exchange mortgage based assets for government bonds. However, whilst the plan was welcomed by mortgage industry officials many have claimed that its will take some time to take effect, and therefore people should not expect the mortgage market to turnaround overnight. In fact, officials from the Building Societies Association recently stated that it could take a couple of years for corrections in the mortgage market to take place.

One official from the Treasury recently confirmed: ‘We expect to see an impact but over time.’

An official from the Council of Mortgage Lenders stated: ‘In the short term the trend of increasing prices and products being removed from the market is not going to be reversed. As and when the banks start lending to each other, the rate for lending will go down and that means that that will start to bring the price down but it is not going to be a dramatic reversal. It is going to be a slow process at best.’

Another industry professional said: ‘For now, mortgage pricing will remain high. If anything, it will increase in the short term.’

One also added: ‘The credit crunch will still hit the economy but it might have hurt more if it weren’t for these measures. The measures prevent the risk of a possible recession becoming a depression.’

Mortgages could continue to get more expensive

admin — Mon, 12 May 2008 05:44:47 +0000

According to a recent report banking officials have warned MPs and the Chancellor, Alistair Darling, that the cost of mortgages may continue to climb over the coming months, despite the launch of a £50 billion mortgage rescue plan introduced by the government, where banks will be able to exchange mortgage assets for government bonds for increased security. Banking officials have stated that the plan may take a number of months to take effect, and in the meantime the cost of mortgage borrowing may continue to get higher.

One official stated: ‘For now, mortgage pricing will remain high. If anything, it will increase in the short term.’

An official from the Council of Mortgage Lenders added: ‘In the short term the trend of increasing prices and products being removed from the market is not going to be reversed. As and when the banks start lending to each other, the rate for lending will go down and that means that that will start to bring the price down but it is not going to be a dramatic reversal. It is going to be a slow process at best.’

A Treasury official said: ‘We expect to see an impact but over time.’

In a stark warning one former Monetary Policy Committee member said: ‘The likelihood of getting the mortgage market going again is slim. This just prevents things from getting worse. It is a backstop.’

A broker from Mform stated: ‘The past month has been the most manic ever in the UK mortgage market.’ There have been rising concerns over repossession levels over recent months, and the Housing Minister Caroline Flint said: ‘We want to ensure that the support is in place for consumers who may need it right now.’

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Mortgages could continue to get more expensive is a post from: Glitec Loans

Darling wants banks to help vulnerable families

admin — Mon, 12 May 2008 05:41:51 +0000

Chancellor of the Exchequer, Alistair Darling, has recently announced that he wants banks to do what they can to help the more vulnerable families in the country, stating that banks need to help struggling homeowners in order to reduce the risk of rocketing repossession levels. Both Darling and the Housing Minister, Caroline Flint, have stated that banks need to give more time to families that fall behind with their repayments.

Darling went on to state that given the huge cash injection that the Bank of England has put into the money markets, along with the recently announced £50 mortgage rescue plan, taxpayers should expect this sort of assistance from banks. A recent report has shown that repossession order levels have increased over the past three months compared to the last three months of 20007, and many expect these figures to continue rising over the course of the year.

The Chancellor also expressed concern that many lenders had increased the cost of borrowing for consumers despite three interest rate cuts from the Bank of England since December. One of the suggestions that was put forward was the possibility of mortgage repayment holidays, which could increase flexibility for homeowners during months where finances were particularly overstretched.

Banks and building societies responded to Darling’s speech by stating that they already offer help to struggling homeowners in terms of coming to arrangements over arrears, but they did add that they were willing to go further in order to try and curb repossession levels. Banks are being asked to provide immediate help and assistance to those unable to meet their mortgage repayment, and wherever necessary to extend the term so that the monthly payment can be reduced.

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Darling wants banks to help vulnerable families is a post from: Glitec Loans