Friday, October 3, 2008

Homeowners Urged To Consider Financial Future

Those homeowners who are either looking to remortgage or are coming to the end of their fixed-rate deal may be set to find themselves coming under monetary strain, it has been suggested.

Furthermore, it was revealed that 62 per cent of people whose fixed-rate contract is to run out before the end of this year have not started to look for a new deal - a proportion the credit information provider claims is "of concern". However, with the global financial market currently experiencing a downturn it was suggested those looking to fix their monthly mortgage repayments once again may struggle to secure a deal if they do not have a very good credit rating. Furthermore, it was revealed that 62 per cent of Britons have a fixed-rate mortgage product which is due to expire at some point in 2008. However, with the global financial market currently experiencing a downturn it was suggested those looking to fix their monthly mortgage repayments once again may struggle to secure a deal if they do not have a very good credit rating.

According to figures released by Equifax, some 41 per cent of Britons have a fixed-rate mortgage product which is due to expire at some point in 2008.


For those consumers who are unable to get another fixed-rate product and are instead forced to go on a different mortgage deal they may face an increase in their monthly mortgage repayments. Such a rise could impact on their ability to make payments on other areas of household spending, for instance personal loans, credit cards and transport costs.

Neil Munroe, external affairs director for the credit information provider, said: "It is vital that homeowners' whose mortgage is coming to an end in the next few months start preparing themselves now. First and foremost they need to think about how they will look to lenders - getting a copy of their credit report is crucial to ensure that all the information that a lender looks at is up to date. And they should give themselves plenty of time to find the best deal. If they leave it too late, there 's a danger that they will revert to the lender 's standard rate, which could increase their repayments significantly [per] month."

Mr Munroe also pointed to research by the firm which showed more than half (59 per cent) of people are at least 5,000 pounds in the red. Meanwhile, just under a third of consumers state to being worried that they are to develop financial difficulties over the course of the next year.

Findings by Equifax also indicated just over a fifth (22 per cent) of homeowners have remortgaged their house in a bid to clear off their debts. However, the external affairs director reported that doing this could be dangerous should property prices fall. Meanwhile, 32 per cent have done this in an attempt to fund DIY projects.

Homeowners wishing to remortgage were first advised to take out a copy of their financial history as loan lenders have taken steps to tighten up their lending criteria. In addition, shopping around for a good quote and factoring in all the costs of a mortgage deal before signing an application were recommended.

In addition, a loan might be helpful for those who are concerned about how they will cope with an increase in their monthly mortgage repayments. Whether looking to finance property renovations or clear off existing debts, a low-rate loan may prove to be of assistance to consumers.

In addition, the typical person owed more money than they saved. Furthermore, it is possible that a loan could help many people after a recent study conducted by Lloyds TSB indicated that the average Briton is "overweight" in terms of managing their finances.


1 comments:

eyepatchman October 8, 2008 at 6:12 AM  

The first point to note here is the shocking statistic of how many people don’t act early when it comes to potentially remortgaging. I recommend talking to an independent broker approximately 3 months before your current deal expires. This gives you plenty of time to arrange a new deal and avoid the higher payments of your current lenders SVR.

Accessing your credit report is a great idea for anyone who is about to remortgage and thinks they may have some recent negative activity on there. If you aren’t aware then you can’t do anything to help the situation. Furthermore, if you are going to several lenders and being rejected, the added searches won’t be helping your credit rating and are unnecessary as a good broker would be able to send you to a lender who is likely to accept you as long as he/she is aware of the whole situation first.

Another thing to note is that even if you do have a less than perfect credit history, there are still options available to you. Again, a good broker should be able to source the best deal. It may be that you don’t even need to look at a sub-prime lender, as some lenders can be surprisingly lenient, even in these current turbulent times.

For some advice on what to do if you are unsure of the strength your credit history can be found here

http://www.wwfp.net/mortgage/bad-credit-mortgage.html

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