Finance Matters

From The Debt Advice Bureau:

Zero Rate Balance Transfers: R.I.P.

It could be the end of 0% balance transfer deals on credit cards as

card issuers are forced to introduce charges in order to stem the

losses caused by “rate tarts” who continually switch from

one zero rate deal to another.

Last week Mint, owned by Royal Bank of Scotland, joined the ranks of

providers such as MBNA

and Barclaycard when it became the latest card issuer to impose a

one-off fee on balance transfers form other credit cards onto their

0% deals.

Until the summer last year transferring balances to a 0% or low rate

credit card was free. Last August that all changed as Barclaycard

heralded the impending demise of free balance transfers when it

became the first card issuer to introduce fees for transfers,

charging 2%, up to a maximum of £35, of the total amount…

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From The Debt Advice Bureau:

More Borrowers Plan to Reduce Their Debts

49% of people with debts say they plan to cut their borrowing over

the next six months, according to the latest Consumer Sentiment

Report from the Nationwide building society, a 7 percentage point

jump from last month and a massive increase from the mere 16% who

were planning to cut borrowing six months ago.

Whilst people don’t expect to save more, the report reveals,

they do intend to spend less and use the increased disposable income

to reduce their debt.

“It is encouraging that consumers appear to be taking a

responsible view of borrowing and more people appear to be planning

to reduce their level of household debt.”, said Stuart Bernau,

Nationwide’s executive director, commenting on the figures.

The five interest rate rises between November 2003 and August 2…

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From The Debt Advice Bureau:

Tougher Bankruptcy Restrictions for Middlesbrough Man’s Credit

Card Spending Spree

Colin Robert John Cliff, from Middlesbrough, has become the first

person in the North East region to be subjected to tougher bankruptcy

restrictions as he was found him guilty of “unreasonable

extravagance”, the Insolvency Service reported today. He will

now be subject to bankruptcy restrictions for the next three years.

Soon after losing his job last year, Mr. Cliff ran up debts of

£4,284 on his new credit card. Over twenty days he used the card

to pay for a holiday, clothes, accessories and to make cash

withdrawals, even though he had no prospect of being able to repay

what he spent. Less than six weeks later he filed his own petition

for bankruptcy with his debts now standing at an estimated £13,740.

Changes to the l…

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From The Debt Advice Bureau:

Correcting Errors on Your Credit File

There is a variety of information held on your

credit report from a variety of sources. If any of it is wrong, it

could affect your ability to get credit.

Here’s how to correct the information held on your report.

The Electoral Roll

If you have registered to vote and your credit file does not show

this, please contact the credit reference agencies listed at the

bottom of this article and they will investigate the matter. If you

have not registered to vote, you may want to contact your local

authority about filling in an electoral registration form.

If you move home you can tell your local authority who will tell

credit reference agencies about your change of registration in the

course of the year.

 …

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From The Debt Advice Bureau:

Six Top Credit Score Killers

Being declined for a loan, overdraft, credit card or mobile phone can

be frustrating, particularly when all the lender will tell you is

that you have failed their credit score and nothing else.

Whilst each lender will ultimately score applications based on the

services they offer and their own criteria, there are a number of

factors which will impact your credit score and could lead to your

application being accepted or declined. Knowing what those criteria

are can help you improve your ability to get the credit you want.

These are the Six Top Credit Score Killers . . .

Not on the Electoral Roll

If you are not on the electoral roll at the address on the

application there is a high probability of rejection.

 …

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From The Debt Advice Bureau:

Flexi-rate credit card rewards faster repayment with lower interest rate

Barclaycard is testing a new credit card with a flexible interest

rate, Repayment Rewards, designed specifically to encourage customers

to repay their debts faster. It does so by lowering the interest rate

the more of the debt you repay each month.

The interest rate charged reduces the greater the proportion you pay

off, meaning those who are constructively making efforts to get debt

free can do so even faster.

In the current trial, those customers repaying at least 10% of their

balance are charged a 9.9% interest rate, but paying just the minimum

2.5% payment will mean you receive a 16.9% interest rate. Those

paying between 5% and 10% of the balance incur a 12.9% rate.

The key premise to the card is that both borrower and lender are

re…

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From The Debt Advice Bureau:

Home Repossession Orders Soar 66 Percent

19,687 mortgage repossession orders were issued in England and Wales

in the three months ending September, a massive 66% increase on the

same quarter last year, according to figures released by the

Department for Constitutional Affairs.

The figure is the highest since the third quarter of 1993, back in

the dark days of the property recession and is far removed from the

low of 9,616 experienced in the first quarter of 2003, just 30 months earlier.

The number of possession orders being issued has been increasing

since the early part of 2004 and the trend is expected to continue

with the expectation that the 25,000-orders-issued mark could be

breached by the end of March 2006.

Don’t Panic Just Yet

Things may be getting worse, but it…

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From The Debt Advice Bureau:

Bad News For Bad Faith Bankrupts

A growing number of bankrupts are being targeted for Bankruptcy

Restrictions Orders (BROs) as Official Receivers pursue those

bankrupts who are believed to have acted in bad faith and contributed

to their bankruptcy, according to figures released today.

Anyone thinking they can rack up loads of debt and use bankruptcy as

an easy way to walk away form their responsibilities needs to think

again. “The screw is tightening on those who have been guilty of

misconduct”, says Desmond Flynn, Inspector General and Agency

Chief Executive of the Insolvency Service.

In the six months to September 2005, 165 people have been made

subject to BROs or Bankruptcy Restrictions Undertakings (BRUs) for

periods ranging from 2 to 11 years. In addition, the Secretary of

State has issued directions to take p…

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From The Debt Advice Bureau:

Bank of England Surprises with Base Rate Hike

A reduced seven member Monetary Policy Committee (MPC) surprised most

economists and market watchers as the Bank of England announced at

midday today that the base rate was raised by a quarter point to

4.75% from 4.50%, where it had sat since August 2005.

The immediate reaction was for shares, Gilts and short sterling to

sell off as the majority were caught out by the surprise move. The

last time the MPC announced a move, when it cut rates from 4.75% to

4.50% at the August 4th meeting of last year, the move had been well

telegraphed. This time, there was no preparation and no hinting.

It is not that a rate increase at some point wasn’t expected, it

was. It is just that it hadn’t been expected this month.

For now the higher rate will begin to feed through into peo…

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