Archive for the ‘Debt Consolidation & Re-Mortgages’ Category

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Reduction In Income Is Main Reason For Debt Problems

Wednesday, October 20th, 2010

According to new figures released by a debt solutions company, the number one cause of debt problems in the U.K is a loss in monthly income.

More than 4,500 people were surveyed between March and September 2010. The results revealed that more than 1/3 of people who sought debt advice during this period cited a loss of income as the main reason for their financial struggle.

 The term ‘loss of income’ refers to a pay cut, loss of working hours or redundancy.

 The survey of debt management clients found that the second reason for people struggling with debt was because of ‘spiralling debt’. A massive 23% of people questioned admitted that years of juggling various debts had led to them growing until the minimum repayments were too high to meet every month.

 A further 12% said they had poor financial management skills and that had caused them to reach the point where they needed to seek advice.

 Other reasons for needing debt help included the birth of a child, increased living costs, ill health and bereavement.

 These results prove that the recession is very much ongoing for a great number of people and financial worries are becoming more and more common. With businesses trying to cut costs during these difficult times, job loss for some is inevitable, as is loss of income. The fear of losing employment is also a main cause of stress for employees, which can lead to illness and the need to take sick leave. This can result in a never ending spiral of debt that seems impossible to escape from.

There are many options available if you are struggling to meet your repayments each month. These include a debt management plan, a remortgage and a tax debt plan.

If you are struggling with debts, call one of our experienced financial advisers today. All calls are confidential and we provide bespoke advice and assistance to help you gain peace of mind.

Call us on free phone 0800 083 2827.

Written by Katie Simpson

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Posted in Debt Consolidation & Re-Mortgages, Debt Management, Loans, News & Features, Tax Debts | No Comments »

Elderly Citizens Drowning In Debt

Wednesday, October 13th, 2010

 New research has found that thousands of pensioners are drowning in debt, with a large number owing in excess of £50,000.

Insolvency experts said ‘unscrupulous’ lending by credit companies is resulting in pensioners being able to borrow large amounts of money that they cannot realistically pay back.

NancollasGreer, a debt advice company, said that of those who approached them, the over-60s had bigger liabilities than any other age group. Pensioners were revealed to owe an average of £52,000 each, compared to an average personal debt of £15,000 for under-30s.

Many pensioners today are feeling the pinch due to the rising cost of living. With little opportunity to earn a good salary, a huge number of pensioners are on a fixed income. In a lot of cases, their only source of income is a state pension which does not increase when the price of food and utilities rises.

While younger people are able to get a better job or promotion to help them repay loans or credit cards, pensioners are stuck with few options. This may explain why younger people have less debt. They are able to take on a 2nd job to boost their monthly income, but elderly people don’t have that opportunity as they are less able to do very active jobs and work long hours. This results in their debts becoming larger and larger and is the cause of much stress to citizens who should be enjoying their retirement.

Research shows that many pensioners who have personal debt are under greater stress than younger citizens who have similar levels of debt. Many older people do not tell their families about their financial struggle for fear of being a burden. They were also found to worry about leaving debt behind that their families may have to repay.

NancollasGreer surveyed pensioners who had unsecured debts and discovered that almost 70% of over-60s have a credit card and of these, almost 15% have more than 4 credit cards.

Mark Neal, managing director of Economic Lifestyle, a retirement housing company, said: ‘We regularly see clients who are heavily in debt. Generally speaking, they are not senselessly running up debts – they are simply doing whatever they can in order to survive.’

Having accrued large amounts of debt, record numbers of people of pensionable age are forced to work instead of relaxing and enjoying their retirement. The number of pensioners who currently work stands at over 1 million. This figure has risen by roughly 150.000 since 2008. Many of these people are working full time to make ends meet as they struggle to make the minimum repayments to all of their creditors.

If you are worried about debt, Sterling Green is here to help. We have a team of experienced advisers who are here to help you with your finances. We have a range of financial management plans which can include credit card, store card, catalogue and personal loan debts. We also offer a remortgaging service where we work to find the best deal to suit you and your circumstances. Each plan is bespoke and we deal with all your creditors so you can relax and enjoy a stress free life.

For a free consultation call us on 0800 083 2827.

Written by Katie Simpson

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Posted in Debt Consolidation & Re-Mortgages, Debt Management, News & Features, Tax Debts | No Comments »

Mortgage Arrears On The Rise

Wednesday, October 6th, 2010

New research shows that mortgage arrears are on the rise in the UK with a record number of people falling behind with their monthly mortgage repayments. 

At a tough time for the economy, more and more people are affected by the credit crisis, which means struggling on and trying to retain enough money each month to pay all the bills. With the cost of living rising, and wages staying the same, many are not only fining their monthly bills unaffordable, but also their mortgage payment.

At the same time, the Association of Mortgage Intermediaries in the UK has called for less restriction in the mortgage market, meaning it will be easier to obtain a mortgage. The past few years have proved tough for first time buyers and with fewer lenders, many people have been unable to secure a mortgage. The AMI has also asked that more advice be given to consumers when they have an initial meeting regarding a mortgage, as a huge number of people are unable to meet their repayments on their mortgage. This shows that lenders will need to further assess the affordability of a mortgage to each new client. This will hopefully reduce the number of individuals who are struggling, and new mortgage holders will be better equipped to deal with a potential drop in income.

Recent figures published have shown that the number of houses that were repossessed in 2009 was well over 40,000. This figure is astronomical and further proves how much affect the economic crisis has had on average families.

With unemployment on the rise, businesses going into liquidation and also personal bankruptcy on the rise, it is no wonder people are finding themselves unable to keep up with their mortgage payments.

The important thing to remember is, if you are struggling to keep up with bills, it is essential that you seek help immediately. A mortgage is the last debt you should miss payments on. If you cannot afford to pay all your bills, you must prioritise your debts. You should always pay your mortgage on time if it is possible.

If you have a mortgage or a secured loan on your property, these are priority debts. It is essential that these payments be made each month as having a roof over your head is the most important thing. If you then feel you cannot pay your other bills, such as credit cards, loans and utilities, you must then contact a financial solutions company immediately.

Financial management companies offer a range of services to suit your individual needs. Here at Sterling Green we can offer debt management plans, help with tax arrears and even a remortgage.

All our financial plans are bespoke and our friendly team of experienced advisers will guide you toward the solution that is right for you. All our plans are specifically designed to ensure you are debt free in the least possible amount of time.

 If you are worried about mortgage debt, credit card debt or have fallen behind on any of your monthly repayments, call us on 0800 083 2827 for a free consultation.

Written by Katie Simpson

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Posted in Debt Consolidation & Re-Mortgages, Debt Management, Loans, News & Features, Tax Debts | No Comments »

More Than 1/4 Of Women Will Rely On Partner’s Pension When They Retire

Wednesday, September 22nd, 2010

According to new research by Prudential, more than 1 in 4 women expect to be forced to rely on their partner’s pension when they reach retirement age.

The survey found that 28% of women over 40 who have not yet retired said that they expected to be reliant on the income of their partner when their working life comes to an end.  A further 22% of the women questioned revealed that they are likely to rely on a basic state pension or benefits as their main source of income during their retirement.

Adding to these figures, a third of women interviewed said that they either didn’t know, or didn’t understand the details of their spouse’s pension savings. This is startling, as so many of these women plan to rely on a partner’s income without knowing what, or how much money they will be receiving. The research also revealed that 62% of men who are living with a partner are set to receive pensions that would support themselves only.

There is a vast difference between what the average working woman can expect to receive upon retirement, compared to what the average working man will receive. The average retirement income for a female currently stands at £12,200 per year, while men are set to receive and average of £19,600 per year. This is solid proof that there is still a gender gap when it comes to earnings and women are set to be financially worse off than men in the future. Adding to this, they will be reliant on their husband’s income for years to come.

A reason for such a dramatic difference in pension income is that women are more likely to opt out of pension savings during their working life. Also, more men are working in high-powered positions than women, and they tend to receive a substantial pension when their career comes to an end.

In February 2010, Prudential also carried out research which discovered that 35% of women who were planning on retiring this year will have an annual income that is below the poverty line. This is a worrying fact, as many people still have outstanding debts to tackle after they retire. With little income and the cost of living on the rise, daily expenses could prove unmanageable for the average woman of pensionable age.

Now is the time to take action and set up a pension scheme that will accommodate future price rises and ensure a comfortable retirement. Living on the bread line with outstanding balances on credit cards, loans or mortgages is a  juggling act and can cause a lot of stress at a time when pensioners should be enjoying their retirement and not worrying about bills and living costs.

As well as now being a great time to put a pension plan in place, it is also a good time to tackle any outstanding credit before retirement comes.

With years of experience in helping people manage credit and taking the stress of debtors’ shoulders, Sterling Green has a number of options that are all bespoke to each of our clients’ personal circumstances.

If you feel you struggle with debt, or are worried that you may struggle in the future, now is the time to act. For a free consultation with one of our friendly, qualified advisers, call us on 0800 083 2827.

Written by Katie Simpson

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Posted in Debt Consolidation & Re-Mortgages, Debt Management, Loans, News & Features, Tax Debts | No Comments »

Debt Collection Firms See 30% Drop In Business

Wednesday, August 25th, 2010

According to astonishing recent news, debt collection firms have seen a significant decline in business since the beginning of the credit crunch. Figures show they have experienced between a 25% and a 30% drop in business over the last few years.

Most people would think that bailiffs would have benefited from the economic downturn, but with increasing numbers of people being made redundant, many people are keeping a close eye on their outgoings.

In a shocking revelation, the head of one of Britain’s leading debt recovery organisations, bailiffs have been unlikely victims of the recession.

Jamie Waller, founder and managing director of JBW Group, said that their lack of business at the moment is due to people being more financially conscious and seeking advice on their debts before their situation becomes serious.

He told the Daily Mail newspaper: “People are taking a more careful approach to their finances since the recession started. It’s had the reverse effect, which has left many bailiff companies overstaffed.”

The Enforcement Services Association, the bailiff trade body, confirmed that the recession was affecting their business, stating that the volume of debt referred for collection has dropped 10% compared to last year’s figures.

With the state of the current economy, debt is discussed much more often and people do not feel the need to conceal their struggle or brush financial problems under the carpet. The more publicity the credit crunch receives, the more likely people are to admit they are having financial difficulty. Thus meaning, they are more likely to seek advice and assistance with those problems before debt collection agencies have a chance to knock at their doors.

Confirming that consumers have become more finance conscious, Waller added: “We are now seeing that 60% are paying up after receiving only a letter.”

In past years, many people who had credit would wait for a final notice before making a contribution toward their debt, but now people are worried for their future. Many people fear for their jobs as redundancy is rife, and do not want to make any hasty decisions when it comes to borrowing money. The recession has caused people to think twice about accumulating debts that they cannot repay.

Recent figures also show that more bailiffs are dealing with debts   over the telephone instead of turning up on debtors’ doorsteps. This is likely due to lenders being more relaxed about calling in money owed to them. Also another factor is that the Bank Of England Base Rate is at an all-time low of 0.5%, meaning less people are falling behind on their mortgage payments. This in turn is creating less debt for the bailiffs to chase, which is bad news for debt recovery businesses, but no doubt a comforting thought to debtors!

Written by Katie Simpson ©

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Posted in Debt Consolidation & Re-Mortgages, Debt Management, News & Features | No Comments »

Don’t Fret Over Your Debt – Help Is On Hand

Wednesday, August 11th, 2010

According to financial experts, it is normal to feel depressed over mounting debts. What you need to remember is the situation isn’t permanent and things will improve. Unfortunately there are people who cannot see a solution to their problems and become so depressed, they contemplate suicide.

We have compiled some important information about this issue and hope that our tips below will help to prevent future tragedy.

Why do people resort to such extreme action because of debt?

A huge problem at the moment is that people just don’t know where to turn when things become difficult financially.

When your credit card bills are mounting, when the mortgage is too expensive, when you can’t find employment, life can seem such a constant struggle that you feel it is unbearable.

“Financial stress can negatively — even severely — impact things outside of the wallet: your health, your job and your relationships,” says David Alecock, a vice president at InCharge Institute, a credit counselling service.

There are several options available to people who are in debt, so why would someone consider committing suicide instead of seeking financial help first?

Where some people have the ability to pull themselves out of a hole, others can find it very difficult and opt for desperate and extreme measures. If a person in financial difficulty develops mental issues such as depression, seeking help can feel impossible.  In addition, people experiencing major stressors such as redundancy,  illness, or loss due to death, or divorce may be more prone to depressive behaviours. All of these stressors can make the financial burden feel even more difficult to bear, and thus making extreme measures seem like the only available option.

Debt and death in the news

There have been many cases reported in the news about people who have found themselves in financial difficulty and have resorted to harming themselves, and even others.

In one recent case reported in national newspapers, a young father in Hampshire took the lives of his wife and two young daughters before taking his own. It was reported that the man had hidden debts from his wife and had been struggling for months to meet his mortgage payments. He had also been anxious about debts he had accrued on credit and store cards.

Another recent case is that of a 60 year old Worcester man who ended his life in May 2010. The man, who had accumulated several thousand pounds worth of debt on credit cards and personal loans, also owed almost £100,000 to friends who had lent him money to help ease the burden of his debts. In addition to this, the gentleman had also missed several payments on his mortgage. He had successfully hidden all his debts from his wife and family and had suffered in silence, without seeking help.

These stories are just two of many tragic cases around the world.

What can we learn from these stories?

“I think people should realize that debt doesn’t have to result in suicide,” says Daniel Reidenberg, a psychologist and executive director of Suicide Awareness Voices of Education (SAVE).

“Too often, people are feeling because of the financial stresses that their only way out of their debt is death. Sometimes they think their family would be better off because of that, and most often, they’re not; they’re far worse. ‘’

Helping a loved one

If you know that a friend or family member is having financial problems, you can offer a sympathetic ear, without judgement. Many people who are in debt want to keep their business private and feel too proud to seek help.This is natural and you can reassure them that any details shared will be confidential.

The power of listening is a great tool and can make a huge difference. Offering discreet help to a friend can be extremely valuable, and the difference between a positive change and a negative one.

Don’t let the debt control you

The hardest part of gaining control of your debts is admitting that you have a problem. This may be difficult, but coming to terms with the issue is a vital part of recovery.

Talking to finance professional can help you see things clearly and put together a plan of action to start controlling your debts.

What you need to do is take a good luck at your income and expenditure and see where you are at the moment. Whether you crunch those numbers yourself or want someone to help you, calling a debt management service is the first step in the right direction.

Friendly staff are on hand to help you devise a plan to get debt free. A debt management plan will involve you making an affordable monthly payment toward your credit, where all charges and interest will be stopped so you don’t have to worry about your debts mounting any longer.

If your creditors are hassling you for money, a debt management company can also put an end to this, ensuring you can get on with your life without having to receive letters and phone calls every day.

Support and crisis help

If you find yourself in a position where you fear you may harm yourself, call The Samaritans helpline on 08457 90 90 90.

If sharing your problems with a friend, or counsellor in person seems like too much at this stage, consider online support groups. iVillage, a website for women, has a message board section with many debt categories, including a debt support group where people share their stories and receive advice and encouragement.

Don’t put off seeking help

Don’t forget that there are people who can help you on the road to becoming debt free.

Financial professionals deal with people’s debts every single day, so there is no need to feel embarrassed. Seeking help is a very brave and very positive thing to do. You should not wait until you hit rock bottom to look for help. Now is the time to look into your options.

There are many solutions available to help with debts and here at Sterling Green, we have qualified financial advisers who will offer a sympathetic ear and some professional advice on how best to tackle your debts. We work with you to find a figure you can afford each month to put toward your debts and we help every step of the way.

Our friendly team are just a phone call away so please do not hesitate to call us on 0800 083 2827, or alternatively, fill in an online form on our homepage so one of our advisers can call you at a time that is convenient.

Posted by Katie Simpson ©

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Posted in Debt Consolidation & Re-Mortgages, Debt Management, IVA, Loans, News & Features | No Comments »

Demand For Mortgage Advice Soars

Wednesday, August 4th, 2010

According to recent figures released by advice website unbiased.co.uk, the number of people seeking mortgage advice has risen by almost a quarter compared to figures recorded 6 months ago.

Around 45000 people used unbiased.co.uk within the last 6 months, compared with 36000 recorded in 2009.

In addition, financial advisers and mortgage brokers across the country confirmed a surge in enquiries from potential buyers.

The most part of the enquiries dealt with were revealed to be from first time buyers. This suggests that the housing market is beginning to recover, serving as great news for many buyers and home owners across the United Kingdom.

Karen Barrett, chief executive at unbiased.com announced ‘’ over the last 6 to 12 months, there has been more and more good news about the mortgage market. We have seen buyers re-enter the higher loan-to-value market, more competitive deals to new and existing borrowers are re-appearing and new providers are entering the market.’’

Although the mortgage market has certainly had a tough time during the recession, there do seem to be some ‘green shoots of recovery’ surfacing. Throughout the recession, lenders have imposed very strict policies surrounding their lending criteria, which has made it very difficult to obtain a remortgage.

Although, with more lenders willing to take on new customers, and more first time buyers showing interest, this means that better rates are available to both existing and new borrowers. As the number of interested borrowers grows, the number of interested lenders will grow and eventually, the mortgage market will be back on its feet.

Here at Sterling Green we offer a remortgaging service and also mortgage advice. For a free chat with one of our qualified mortgage advisers give us a call on 0800 083 2827.

Posted by Katie Simpson ©

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Debt Management Plans – Frequently Asked Questions

Wednesday, July 28th, 2010

What if my circumstances change during a Debt Management Plan?

Because a Debt Management Plan is an informal agreement, it is flexible. You can increase your monthly payment or decrease it depending on your circumstances at any time.

Change for the worse
If your circumstances change for the worse and you cannot commit to the agreed monthly payment, inform your personal finance manager (provided by the management company you are dealing with) and they will agree a new payment arrangement based on your circumstance.

Change for the better
If you feel you could afford to pay more to your debts, again, you must consult your personal finance manager and they will agree a new payment plan. By increasing your monthly payment, you are clearing your debts faster.

How does a Debt Management Plan work?

A DMP or Debt Management Plan is an informal agreement with your creditors. If you are in financial hardship, it allows you to reduce the amount you pay to your creditors each month so that your payments fit within an affordable monthly amount. All debts will be consolidated into one easy monthly payment so you do not have to pay each individual creditor seperately.

The interest you were paying to your creditors will be stopped so that you are only clearing the capital debt that you owe instead of going around in circles, just paying off the interest that the debt has accrued each month.

Can I keep some of my debts out of a Debt Management Plan?

It is advised that you include all unsecured debts into your plan, because if you leave out certain debts, your creditors may feel you are favouring other lenders above them and may make negotiation difficult.

Also, if you are leaving out certain debts, such as a credit card, to make sure you can still borrow, this is defeating the object of a debt management plan. Their job is to rid you of debt and if you continue to use certain credit cards, you are only perpetuating your cycle of debt.

How long will a Debt Management Plan last?

There is no limit on how long a debt plan can last. It all depends on your individual circumstance, i.e., how much debt you owe, and how much you can feasibly afford to pay to it each month. The more you pay, the shorter the term on your plan will be.

How long does it take to set up a Debt Management Plan?

It is very simple. For example, if you call Sterling Green, you can speak to a customer service consultant right away who will assess your situation briefly and pass you straight over to a financial advisor. The advisor will then tell you how much we can save you each month, and how long it will take you to be debt free should you take up a plan with us. The whole process is very quick and lasts minutes.

What will happen to my credit file if I go into a Debt Management Plan?

Your credit rating is not worsened because of the fact that you are in a DMP. If you are struggling to repay your creditors and have missed payments for whatever reason, this will have already damaged your credit rating so a management plan will not affect your rating any further.

Although the fact that your credit rating is affected sounds bad, in fact all that is happening is that you are being prevented from borrowing more money for a certain length of time. Of course, the idea of a debt management plan is that it clears your existing debts. It doesn’t pave the way for you to get further into debt.

How much will a Debt Management Plan cost?

Our company takes a very small fee of 15%. This cost is included in the agreed monthly payment so it is not a surcharge. Fee rates vary between companies, some charging in excess of 30%.

What happens to my house and car in a Debt Management Plan?

Mortgages and Hire Purchase items are not included in debt management programs, simply because it would put your home and HP item in jeopardy of repossession. The only debts that are included are debts which are not secured to a property or a purchase. These can be in the form of personal loans, credit cards, overdrafts, catalogues, disconnected bills from a previous address or shortfalls on a previous mortgage which has now been transferred to unsecured debt.

What happens when I stop paying my Creditors and opt for a Debt Management Plan?

When you engage in a plan, your creditors are not allowed to contact you either by telephone or post. They are also not permitted to send debt collectors or bailiffs to your property. Your debt will be managed by your chosen debt management company, who will correspond with your debtors on your behalf so you do not need to worry about unwelcome contact from your creditors.

My bank is a Creditor; should I open a new bank account?

When undertaking a debt management plan, you will need to change banks and close any accounts where you have outstanding balances. This is because you will need to keep control of your finances and keep them separate from the parties you owe money to. Even with a bad credit rating, you will be able to open a new basic bank account with no overdraft facility to help you along your way.

For more information please  fill out a call-back form on our homepage to speak to a qualified advisor.

Posted by Katie Simpson ©

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OAPs Unable To Enjoy Retirement Due To Mounting Debts

Wednesday, July 21st, 2010

Recent statistics show that pensioners in the U.K owe a mind-blowing £8.4 billion in outstanding debts.

Additionally, almost 600,000 citizens over the age of 65 are still paying off their mortgages, with each individual owing more than  £30,000. Even more worryingly, over 1.5 billion pensioners owe  substantial amounts on credit cards, arguably the worst form of credit to have.

Many over 65’s also owe money on store cards, overdrafts, catalogues and personal loans that they are unable to pay off. Due to high interest rates and charges at the moment, these OAPs are struggling to pay off their unsecured debts with low incomes and pensions. This is resulting in a lot of worried pensioners and  for many of them, it is having  a detrimental effect on their health.

According to the CCCS, the age group with the highest rise in personal debts within the last year were citizens of pensionable age. This is mainly due to the rising cost in living expenses, which their limited imcomes cannot cover.

These difficult times are stopping OAPs from enjoying their well-earned retirement and forcing them into turmoil, juggling debts and general living costs.

Here are some simple tips if you are struggling with debt

1. Prioritise your credit payments

Work out how much money you owe to each individual creditor. Then make sure the biggest debt receives the highest monthly payment, and the lowest debt, the smallest payment, in order to restore some balance to your credit commitments.

Your first priority should be any debts secured to your property or any hire purchase items, as if you miss payments, your home and higher purchase goods can be repossessed by the lenders.

The second priority is any bill that can result in you being prosecuted if you do not pay, such as tax and TV liscence.

2. Look into the best deals on credit cards

You should take the time to shop around for the best deals on credit cards. 0% interest cards are widely available and could save you hundreds of pounds in interest payments.

It is also worth looking into the best rates for gas and electricity. There is much competition between energy suppliers at the moent, so research each company and find out what is the cheapest option for you and whether you are eligible for any discounts.

3. Be aware of any government benefits available to you

Look into if  you are eligible to claim any benefits from the government. Filling in a simple form can be the difference between considerable help, and no help at all. Millions of pounds go unclaimed every year in entitled benefits, so contact your local authority to find out whether you are eleibile for pension credits or council tax benefit.

4. Remortgaging and extra income

Another great solution to your debt problem is a remortgage or downsizing your home. If you still reside in the family home and you feel there is surplus space, you could look into moving to a smaller property and using the profits from the sale of your house to help clear your unsecured debts. If you do not wish to sell, you could opt for a remortgage, providing there is sufficient equity in the property.

Another  solution is to consider taking on a part time job to boost your income. Light work in a shop or call centre can be a huge help to able-bodied individuals.  Short working hours in a comfortable environment are available and your many years of working experience can be very attractive on a CV.

5. Debt Management Plan

Another great option is a debt management plan. These plans can reduce the amount of money that you are paying out on credit each month and also stop the interest and charges you are currently incurring. Many people choose to engage in a plan to make their lives much easier.

While on a debt management plan, you do not have to deal with your creditors any longer. They are banned from calling or writing to you. Instead, your personal finance manager will negociate a lower monthly payment to your creditors and will deal with them directly on your behalf, so you are just making one affordable monthly payment instead of attempting to juggle each individual debt.

Also, as you are not paying out on costly interest rates, you are clearing the capital debt that you owe, so you will be debt free much sooner that you would without a management plan.

Posted by Katie Simpson ©

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Posted in Debt Consolidation & Re-Mortgages, Debt Management, Loans, News & Features, Tax Debts | No Comments »

Now Is A Good Time To Remortage

Wednesday, June 23rd, 2010

If you are a homeowner and you have a mortgage that is on a standard variable rate (SVR), now might be just the right time for you to remortgage, considering the current state of the mortgage market.

Since the beginning of March 2009,  the Bank of England base rate has stood at a record low of 0.5%. This was great news for lots of borrowes and has meant that huge numbers of homeowners who have come to the end of their mortgage deal over the past few years or so, have been benefiting from the low revert-to rates.

Although the average standard variable rate remains very low currently, to avoid any risks many experts are now suggesting that now might be a good time to look into a remortgage.

Amongst the reasons why vast amounts of mortgage experts think remortgaging away from an SVR could be a wise move now, is that 16 different lenders have increased their SVR since base rate dropped to 0.5%. This could likely continue to increase and many more companies could join in the price hike. It is worth noting that no price cuts have been seen during the past year, so waiting for falling rates could be dangerous.

In addition, two lenders have increased their SVR this month already, suggesting SVRs are only going to carry on rising in the forseeable future, despite the prospect of unchanged base rates.

Also, recent figures show that the cost of fixed rate mortgages had fallen dramatically in recent months, with five year fixed rate mortgage deals starting around 4%, the lowest and cheapest deal since 2003.

Furthermore, the availability and pricing of mortgages at higher loan to values (LTV) has been found to have improved significantly.

Anyone paying an SVR of 3.5% or higher, whose LTV is 85% or less, is most likely to benefit from remortgaging, providing they do not have mortgage arrears within the last 12 months.

To calculate loan to value of your property, take your mortgage balance figure plus the outstanding balance of any secured loans on the property, divide this figure by the value of your property and times the answer by 100. This should give you a figure between 1 and 100. This is your loan to value percentage. If it is less than 85%, a remortgage is definately a great option that is available to you and a chance worth taking if you want to secure the best possible deal.

Posted by Katie Simpson ©

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