Monthly Archives July 2009

Best Mortgage Deals from your Sofa or the High Street – Not Brokers!

As we all know, banks and mortgage lenders recently lost quite a bit of money.

There’s a lot of smoke and mirrors being used at the moment to suggest they are posting healthy profits but it’s only because they are robbing Peter to pay Paul.

For many years mortgage intermediaries and brokers have been helping consumers find the best deals on the market. Naturally there have been those who exploit the system but any self respecting adviser should always have the clients best interests at heart.

Trawling through the thousands of mortgage offers available, often having access to exclusive products in the market and generally helping consumers understand the process and commitment.

This has and is changing.

The mortgage broker is being cut out of the loop.

The best deals are no longer available from brokers.

Lenders are cutting costs by offering better products direct to consumers. This way they can charge a slightly lower rate, make the offer seem more attractive and still save money by not paying anybody any commission.

eg: Mortgage via broker has arrangement fee of £999 and lender pays commission of £1200 – the lender is £201 down.

Direct mortgage has no arrangement fee but no commission is paid – the lender is even.

According to a recent report mortgages from brokers can cost on average £200 per month more when all the costs are added up because the best deals are now available direct.

http://www.ifaonline.co.uk/ifaonline/news/1495745/consumers-pay-gbp200-advised-mortgage

So if mortgage advisers can’t offer the best deal but still wants to provide the best advice they have to try charging for telling c customer to go down the road and speak to a high street lender.

How many people will willingly pay £300 just to be told where to go for a walk, who to phone or where to go online?

Where does that leave the customer?

Without paying for advice people will be left to make their decision based on what’s on TV, the internet or the ever faithful and trustworthy high street banks & building societies. Great!

Her Majesty’s Revenue & Customs with a sense of humour

This is (apparently) a real reply from the Inland Revenue. Whether it is or not, it’s still entertaining and if everyone was like this at HMRC you could sit and chat for hours!
Dear Mr x,
 
I am writing to you to express our thanks for your more than prompt reply to our latest communication, and also to answer some of the points you raise. I will address them, as ever, in order.
 
Firstly, I must take issue with your description of our last as a “begging letter”. It might perhaps more properly be referred to as a “tax demand”. This is how we at the Inland Revenue have always, for reasons of accuracy, traditionally referred to such documents.
 
Secondly, your frustration at our adding to the “endless stream of crapulent whining and panhandling vomited daily through the letterbox on to the doormat” has been noted. However, whilst I have naturally not seen the other letters to which you refer I would cautiously suggest that their being from “pauper councils,   Lombardy   pirate banking houses and pissant gas-mongerers” might indicate that your decision to “file them next to the toilet in case of emergencies” is at best a little ill-advised. In common with my own organisation, it is unlikely that the senders of these letters do see you as a “lackwit bumpkin” or, come to that, a “sodding charity”. More likely they see you as a citizen of Great Britain , with a responsibility to contribute to the upkeep of the nation as a whole..
 
Which brings me to my next point. Whilst there may be some spirit of truth in your assertion that the taxes you pay “go to shore up the canker-blighted, toppling folly that is the Public Services”, a moment’s rudimentary calculation ought to disabuse you of the notion that the government in any way expects you to “stump up for the whole damned party” yourself. The estimates you provide for the Chancellor’s disbursement of the funds levied by taxation, whilst colourful, are, in fairness, a little off the mark. Less than you seem to imagine is spent on “junkets for Bunterish lickspittles” and “dancing whores” whilst far more than you have accounted for is allocated to, for example, “that box-ticking façade of a university system.”
 
A couple of technical points arising from direct queries
 
1. The reason we don’t simply write “Muggins”on the envelope has to do with the vagaries of the postal system;
 
2. You can rest assured that “sucking the very marrow of those with nothing else to give” has never been considered as a practice because even if the Personal Allowance didn’t render it irrelevant, the sheer medical logistics involved would make it financially unviable.
 
I trust this has helped. In the meantime, whilst I would not in any way wish to influence your decision one way or the other, I ought to point out that even if you did choose to “give the whole foul jamboree up and go and live in   India ” you would still owe us the money.
 
Please send it to us by Friday.
 
Yours sincerely,
 
***
Customer Relations

Man Charged More Than Worlds GDP for Cigarettes

A man from Manchester (New Hampshire) has been charged more than the worlds combined GDP for a packet of cigarettes.

http://uk.news.yahoo.com/5/20090716/tod-man-charged-23-quadrillion-for-pack-870a197.html

It got me thinking, why don’t we all put our combined available credit card balances into one big fund, get the debt insured by AIG and use it to bail out the worlds faltering economies?

Are House Prices Really Bottoming Out?

With recent sentiment suggesting house prices will continue to fall quite substantially and conflicting data from major building societies it’s difficult to be certain where house prices will go over the next few years.

I am however fairly sure there will be further decline but the extent of which is in doubt.

When comparing the current housing crash to the past and taking into account affordability levels the extrapolation suggests they could fall by as much as 30% – 50% before they really hit the bottom but mortgage lenders seem to be sticking their necks out with offers that suggest they are at least confident house prices will rise in the not too distant future.

Either that or they are resuming irresponsible risky lending practices and potentially lining up customers for the negative equity shock of their lives.

Nationwide has announced it will be offering 125% loan to value (ltv) mortgages for people wishing to move house.

Several lenders have been offering 100% mortgages to existing customers as a way to allow borrowers with little or no equity the chance to fix their rate instead of remaining on the lenders standard variable rate (SVR) and stave off any rate shock in the short term if interest rates begin to creep up.

Not only that, it also allows the lenders to charge arrangement fees and profit from borrowers who may have otherwise been stuck.

It also increases the statistics related to mortgage approval rates.

Some lenders (Halifax, Lloyds, Coventry), it has been claimed, have been offering deals above 100% ltv to existing customers already in negative equity situations.

But to offer 125% mortgages to customer wishing to move house seems life a huge leap of faith in the future of house prices.

Do Nationwide and other lenders know something we don’t?

What’s your LTV?

Win a Book of 1000 CEOs worth £25

I’ve been given a copy of a new book entitled 1000 CEOs from DK Publishing (Dorling Kindersley)

I have also been allocated 5 copies to give away!

(image links to DK.com page about the book)

 

The book features reviews of 1000 CEOs (as you might expect!) detailing their success, a snippet of how they achieved great fame, fortune and wealth plus insightful and inspirational quotes.

Among the reviews are some of the worlds best known entrepreneurs, ‘start up titans’ , strategists & visionaries including Stelios Haji-Ioanou, Richard Branson, Giorgio Armani, Warren Buffet, David Packard, Charles E Merril, Bill Gates and 993 more!

The book also includes strategies for success, lessons in business, leadership techniques and a host of diverse and useful hints and tips for success in business (and life).

An excellent hardback reference book that will make a valuable addition to the shelves of any aspiring business person or tycoon!

There are 5 copies available plus 20% discount codes at DK.com for 5 runners up.

How to win.

As this is a personal finance blog I have devised a very basic survey for entrants to complete which asks a few very simple questions about money etc. and enters their details into a prize draw.

None of the questions require you to reveal personal information.

There is no requirement to answer any of the questions and even though answers are not required if you have an interest in something, the choice is yours.

The closing date for entries is the 31st August 2009.

To enter the draw click here

 

Don’t forget to email this to anyone else who might like the chance to win a copy of the book using the link below.

Fed Up With Automated Sales Calls

Something that is becoming increasingly more frequent and I’m sure annoys the hell out of plenty of people, including me are ‘automated’ cold calls.

Recorded messages offering to write off all my debt are the most frequent but to be honest I don’t listen to more than a couple of words before putting the phone down so I couldn’t say what all of them are trying to sell me.

I’m one of the lucky ones who works from home with a telephone on my desk and although annoying and a waste of time I’m not elderly, disabled or unwell, so it’s no real hardship to answer the phone.

I loathe to think about the inconvenience these nuisance calls cause some people.

What’s so good about a government backed scheme that could write off all my debt anyway? It’s probably an IVA they’re trying to sell me and as far as I know they last 5 years then stay on your credit file for another 6. That’s 11 years of complications, difficulty and high non-preferential interest rates. Yippee!

Or it could be someone trying to help me reclaim unfair charges or have my loan or credit card agreements torn up and written off.

It’s true, some people have been able to write off card debts and loans but there’s always a fee and no guarantee of a positive result.

These are the types of automated calls I keep getting.

Always about ways of reducing debt or helping me end my money woes.

Never offering cheap wine or bargain gym membership! Or just anything I could actually do with!

I’d be happier if it was one of the neighbours kids phoning up offering to wash my car!

The message needs to get across to the public that these are not ‘great deals’ they are just nuisance sales calls. Another way of advertising and also an invasion of personal time and space.

There are various suggestions of how to deal with these calls such as listening to the message until a real person comes on the phone then asking them to hang on a minute, then never going back to the call.

Or as soon as a real person comes on the phone say ‘Chief Constable Smith – how can I help?’ (not sure about that one though…)

These are novel ways of dealing with the problem but the preferred method is to register your details with the Telephone Preference Service.

This service has been around for years and in the past it meant writing a letter but now it’s as easy as a few mouse clicks.

It can take 28 days before unwanted calls stop and it may not stop them altogether but it’s easy and only takes a couple of minutes.

I’ve entered my parents details too because believe it or not, they don’t use the internet!

Visit the Telephone Preference Service

Or find useful, helpful information from the Information Commissioners Office about how to stop unwanted sales calls, emails, letters etc.