Finance Matters

• 17Oct

  Nationwide promotes 95% mortgages

  Mortgages No Comments

  From This is Money:

  Nationwide Building Society has hit the headlines after promoting its 95% mortgages for existing borrowers looking to remortgage or move home.
  These deals are not new and the building society has offered mortgages to those with small deposits for some time, however, it has promoted them in its latest round of mortgage deals.
  The mortgages for those with just a 5% deposit are only for existing Nationwide borrowers, either moving home or remortgaging, and are available as tracker of fixed rates.

  Moving home at 95%
  For those moving home the fixed rates at 95% are very expensive: a two-year fixed rate deal starts at 6.48% with a fee of £896 and rises to 6.88% with no fee. A five-year fixed rate costs an eye-watering 7.43% with an £896 fee.
  The trackers offer a better initial rate at 95% but will become expensive when interest rates rise. A two-year tracker starts at 5.33% with an £896 fee: tracking a full 4.83% above base rate this would hit 6.83% if the base r…

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• 17Oct

  Wilsons sell buy-to-let empire for £180m

  Mortgages No Comments

  From This is Money:

  Now they are selling up with an asking price of £180m for their property empire that is claimed to only hold £45m worth of debt against it.
  Foreign investors are rumoured to be interested in the portfolio, but property experts suggest they will want a discount to market value and question whether the Wilsons will reach their target.
  Laura Powell meets the Kent property magnates who are confident that now is the best time to sell and finds out how they made their fortune.

  This certainly doesn’t look like the stately pile of a billionaire. There’s no gold jacuzzi, no personal tanning salon (like Simon Cowell), no £16m private jet (like Sir Philip Green), not even a Rolls-Royce (like Del Boy)….

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• 17Oct

  Landlords predict price and rent recovery

  Mortgages No Comments

  From This is Money:

  After enduring two years of falling house prices and a year or more of falling rents, landlords are now looking to property values rising and rents possibly increasing.
  The latest quarterly survey of landlords by Paragon Mortgages shows that on average, they expect a 0.8% increase in the value of their portfolios over the coming year as the property market mounts a sustained recovery.
  While this is only a small increase, it marks the first positive response since the first quarter of 2007 and follows the spate of recent house price reports suggesting house price are rising.
  And according to property website FindaProperty.com, an early autumn surge in rental demand has also boosted buy-to-let. There were 6.2% more properties rented out in September, with a particular run of activity from students and young workers.
  FindaProperty’s monthly report said that rents were steady at £829 in September, highlighting the market stabilisation that began in the spring. They have inched…

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• 17Oct

  Rics: Property back to boom-days peak

  Mortgages No Comments

  From This is Money:

  Twenty-two per cent more agents saw rises than falls in September, the highest ‘positive reading’ since May 2007 and compares with a figure of 10% in August.
  The evidence suggests the price revival is being driven by an acute shortage of properties, particularly family homes.
  There is also clear evidence of a North-South divide, with prices in London and the South-East showing a surge while many parts of the North are still suffering falls.
  Ian Perry, a spokesman for the institution, said: ‘A lack of supply is still underpinning the rise in house prices. Meanwhile, the level of inquiries from potential purchasers is increasing.
  ‘This imbalance between demand and supply suggests that house prices will move higher in the near term.’

  The Rics report is regarded as a reliable early indicator of market trends, having given warning ahead of the property crash of the early Nineties. It also signalled price falls in the summer of 2007 while other major surveys only registered dec…

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• 17Oct

  Should we worry about capital gains tax?

  Mortgages No Comments

  From This is Money:

  We have heard that if he changes the mortgages to take account of the rental we wouldn’t be liable for capital gains tax as he lived in the house for nine years. Is this correct? K.T., Preston, Lancashire

  Based on the information supplied, the property seems to qualify as your boyfriend’s principle private residence and after he vacates the property he will still be able to claim relief for a period of 36 months, even if the property is let.

  He would, therefore, be strongly advised to obtain a professional valuation of the property from a chartered surveyor at the date he vacates, as this information could be useful later in any queries over potential tax liability. The fact that the property may be held on a different mortgage does not alter the capital gains tax position, but he must notify his mortgage lender if he vacates the property and installs a tenant, otherwise he is in breach of the terms of the loan….

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• 17Oct

  Can a viewing day help sell your home?

  Mortgages No Comments

  From This is Money:

  Now meet ‘open towns’? last Saturday, Strutt & Parker’s 33 offices persuaded all but a handful of properties on their books to do an ‘open house’ on the same day.

  The initiative comes on the back of the resounding success of a regional pilot in March.

  ‘It staggered us how many people went to see the properties.’

  ‘If they know others are going and the owners are ready for it, they are much more inclined to do it, too,’ says Major.

  ‘We had two months of viewings in one day. One of the houses had 21 viewings. We were almost knocked over by the rush,’ says Major.

  ‘We had one house that had been on the market for nine months ? we had three viewings on the open day and one bought.’

  And it galvanises into action those who’ve expressed a prior interest and know that the day will attract many more potential buyers. It doesn’t necessarily push up the price, but it prompts people to make a deal.

  Strutt & Parker advertised locally and nationally for two month…

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• 17Oct

  Minor offences leave 7m in insurance trap

  Insurance No Comments

  From This is Money:

  Anyone with a minor offence or a police caution against their name could invalidate their cover if they do not tell their insurers about them.
  The condition can apply to anyone else in the family or friends staying in the property.
  It can also affect landlords who may find their policies are worthless if their tenants have convictions they have not disclosed.
  The situation came to light when one major insurer demanded a customer give back the £241,000 pay-out she received after her home was burned down in an arson attack.
  Michelle Barber, who was caught out for failing to declare a £150 fine for a benefits offence, said: ‘I was shocked and felt sick. Why did no one tell me such a tiny fine could do this?’
  Her Barnsley home was burned down by her husband, Gary Hooley, following a row at a friend’s 50th birthday party in February 2007. Hooley, who had not wanted her to keep the detached bungalow in any divorce settlement, was jailed for four years.
  But, two weeks…

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• 17Oct

  Uncovered: the real cost of a break-in

  Insurance No Comments

  From This is Money:

  Gardens
  These offer rich pickings for thieves. They can be packed full of exotic trees and plants, luxury furniture, barbecues, heaters and power tools. Estimates by Lloyds TSB insurance suggest the total value of equipment and plants kept in gardens could be more than £15bn. And garden crime is a growing problem. Lloyds says it processes about 5,000 claims a year with an average loss of £730.
  Standard mainstream home contents policies will usually stretch to garden contents – with limits. These vary widely from a few hundred pounds to a few thousand, depending on the insurer. There will be single item limits with the cover. Garden cover is a valuable benefit, so check the small print when buying or switching policies.
  Rebecca Holmes, spokeswoman at Aviva, formerly Norwich Union, says: ‘Most insurers will cover garden items and tools in locked sheds, but if you have something of particular value it may be worth talking to your insurer or a broker.’
  Aviva, for examp…

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• 17Oct

  Left exposed to the medical tourist trap

  Insurance No Comments

  From This is Money:

  But they are leaving themselves exposed if anything goes wrong, as ordinary travel insurance policies do not cover complications resulting from elective surgery.
  Last week, specialist travel insurer PJ Hayman launched the first policy to do this. But there are restrictions and the cover is not cheap.
  The policy is underwritten by Axa and covers the policyholder for treatment and lodging costs as a result of elective surgery – rather than emergency surgery – going wrong.
  Cover does not begin until 48 hours after the procedure and can last for up to 31 days while the patient is overseas. But the insurance, which extends to those up to the age of 74, ceases on return to the UK.
  Most dental and cosmetic surgery procedures are included, plus others such as laser eye surgery, treatment for fertility problems, skin lesions, varicose veins, cataracts and hernias. Botox injections are covered, but heart surgery and cancer treatment are not.
  The surgery must take place in an officiall…

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• 17Oct

  Insurers must reinstate mortgage cover

  Insurance No Comments

  From This is Money:

  The 40-year-old marketer from Kensal Rise, north-west London, will see the monthly cover provided under her MPPI policy with Cardif Pinnacle increase from £1,000 to £1,500.
  This is after it was controversially cut by a third earlier this year by the insurer.
  ‘It’s wonderful news, especially given my mortgage payments are about to go up and I am the only breadwinner in the house,’ she says.
  Husband Cedric, 41, is still recovering at home from a kidney transplant and they have an 11-year-old son, Kori.
  As its name implies, MPPI helps pay mortgage bills in the event of a homeowner losing their job or suffering serious illness.
  In theory, it is an invaluable form of insurance, but early this year a number of providers, including Cardif Pinnacle and the Post Office, decided to offer customers a stark choice – either pay higher premiums or see their cover drastically reduced.
  Most customers, including Alison, had no choice but to go along with the insurer’s demands,…

  Click to read the full article »

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