FinanceDaily - 70 Days of Salary to Clear Debt Interest Alone
With personal loan debt almost four times higher than last year, even our combined January and February earnings are not enough to pay off the interest on our debt – without actually even reducing it, new figures reveal.
As a nation, we have worked the last 70 days solid to earn enough money just to service the interest on our credit card and loan debt, let alone re-paying the actual debt itself, according to new figures from Unbiased.co.uk.
The site has hailed today, Monday 10th March, as Debt Freedom Day. This is a stark increase from last year, when Debt Freedom Day was the 1st February 2007, meaning we only spent 31 days to service our debts.
The figures show that personal loan levels in the UK increased to £9.8 billion, from £2.6 billion last year. At the same time average interest rates on personal loans are now 0.5% higher, which means that Brits pay almost £1.5 billion in interest payments alone. Credit card debt in contrast has dropped slightly, decreasing from £55.6 billion to £54.9 billion.
Personal debt levels in general have increased by over 10% over the last year and average levels of interest payable on this debt has increased by over 6% - making the proportion of income needed to service this financial burden even greater.
Tags: Personal Loans
Bank holds rates despite sign of fall in house prices - Times Online
However, some experts predict that tightening of lending criteria by mortgage lenders could exacerbate the slide in prices. Banks and building societies, which are finding it increasingly difficult to secure funding for new mortgages in the wake of the credit crunch, have become much more careful about home-loan deals.
Last week Cheltenham & Gloucester stopped offering mortgage deals to home buyers lacking a 10 per cent deposit. Alliance & Leicester and Britannia Building Society have a similar policy.
Lenders, in order to boost margins, have also been raising the interest rates they charge. Abbey is set to raise rates on its fixed-rate deals by up to 0.2 percentage points ...
Tags: Home Loan Advice
Credit crunch rebuke for FSA and Bank of England - Times Online
Britain’s financial regulator and its central bank must develop a better plan for warning banks and investors of high risks, after overseeing the loss of billions of pounds in the global credit crisis, a damning report by MPs will recommend today.
In its second report on last year’s liquidity crunch, the Commons Treasury Select Committee criticises the Financial Services Authority (FSA) and the Bank of England for failing to ensure that financial companies were prepared for the worldwide closure of credit markets. The Government must respond to the charges within two months.
Although the FSA and the Bank gave warning many times that banks were lending too much too easily, they failed to follow up their words with action, the cross-party committee says. John McFall, the chairman, says: “It is clear that many market participants failed to heed warnings about a serious underpricing of risk and the potential for impaired liquidity in financial markets in the mistaken belief that the good times would go on and on.”
The committee will recommend that in future the regulator and the bank should write a letter to financial companies highlighting two or three key risks. The MPs believe that the two institutions should then seek confirmation that the companies have considered the risks and publish a commentary on the responses.
Banks and investors, such as pension and hedge funds, wrote down billions of dollars last year after the value of their investments in asset-backed securities plunged because of a wave of defaults on the underlying American sub-prime mortgages. The banks, investors and credit-ratings agencies that rated the securities also face heavy criticism by the MPs.
Tags: Bad Credit Loans,
Mortgages
