Responding to the release on the UK's debt crisis, RatandMouse sums it up nicely:
On their own, these figures are worrying. But they become acutely worrying when read against yesterday's inflation figures (2.5%, August) - the fourth consecutive month above the Government's 2% target. It's hard to believe interest rates won't reach 5% before the year's out. How much shit, and how big the fan... those are the bigger questions.
Facts and FiguresThe Citizen Advice Bureau (CAB) revealed that 770,000 mortgage holders throughout Great Britain, have missed one or more mortgage payments in the last twelve months. The charity is warning people to think carefully before taking on additional borrowing, particularly if they already have a mortgage and is lenders to ensure people can afford their repayments before issuing loans.
The survey also found that some people don’t understand what secured lending is and that missing payments on these loans could lead to them losing their home. 11% of survey respondents thought a secured loan was a loan where the borrower ‘can miss payments and their home will always be safe’, with a further 10% of people thinking it was a loan ‘where the borrower can choose to pay back as much or as little as they like each month’. There is also concern about the way secured loans are marketed in newspapers, radio and TV adverts.
Dont Trust a Celebrity! The CAB gave examples case study examples of some of gross levels of misunderstaning:
A Gloucestershire couple had mounted up debts of nearly £300,000, secured on their home. They had remortgaged eight times (four times with the same lender) and sought advice when they could no longer afford to make the repayments on the mortgage from the husband’s self-employed income.
In County Durham a 54 year old woman was finding it difficult to meet the repayments on a secured loan of £74,000 and other debts. She told the CAB that she had chosen the secured loan because she felt she could trust the celebrity who appeared on the TV advert for the loan company. The client did not understand the implications of the secured loan she had taken out – i.e. that if she did not meet the repayments she would lose her home.
Other Facts of Interest- FTBs are the worst offenders, and in the under-24 bracket the figure represents 13% of mortgage holders.
- the Bureau has dealt with 51,000 calls regarding difficulties making mortgage repayments in the last year, and officers are comparing the scale of the problem with the recession of the 1990s.
- Repossessions (8,140 in the last six months) are at their highest level in five years.
Property software company Vebra (which was sold to Guardian Media Group last month), announces the launch of Thinkproperty.com, which they claim will give Rightmove "a run for it's money" BricksnClicks reports that Vebra MD Stephen McCluskey, has said that an injection of funds from the new owners will give ThinkProperty.com a new lease of life; furthermore with Guardian backing and exposure, expect to see "a really massive ramping-up of consumer activity" between now and January, according to McCluskey.
