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Following recent warnings by the Financial Services Authority (FSA) in its Financial Risk Outlook that the UK could face more difficult economic conditions this year, the financially regulator has relaunched its dedicated consumer website to help people manage their money.  

Moneymadeclear.com offers free impartial information along with the FSA's own Compare product tables.

The site allows consumers to find a simple explanation of the 'credit crunch' and valuable information on how to manage if, for example, borrowing becomes more expensive.  

The site received 2.8 million visits last year and prides itself as providing jargon-free information on a range of subjects including mortgages, secured loans and credit cards as well as interactive tools to help work out how much borrowing will cost at different interest rates and a budget calculator to help manage your budget.

There are also printed guides covering 'what to do if you can't pay your mortgage', as well as a 'making your budget work for you' guide.  

The site has revamped the Compare product tables as part of the relaunch to make it easier for consumers to shop around. The regulator is currently planning to add its first Payment Protection Insurance (PPI) tables soon.

The FSA site also issues the latest news about scams and swindles as well as alerts about the most important issues facing consumers in the world of financial services such as scams.

A scam is a scheme designed to con you out of your cash. Scams come in many forms and are getting more sophisticated all the time. So, even if you think you would never be fooled, make sure you remain sceptical about offers that seem too good to be true.

Moneymadeclear offers advice on deceptive premium rate competition scams, bogus sweepstakes and lotteries, get–rich–quick schemes and fake health cures.

The site also includes a scambusters quiz, and tips on what to do if you're unsure or you discover a scam. There’s also a list of contact organisations that are supporting the stamp out scams campaign.

It also investigates bogus FSA and FOS communications – letters or emails claiming to be from the FSA or FOS asking for your personal information or money.

The FSA can protect you from share scams (also known as boiler rooms), affinity fraud, and online scams.

Affinity scams are investment scams that target members of a group, such as a community or a religious, ethnic, elderly or professional group.

Online scams tend to be on the rise now we have entered the digital age and fund transfer schemes such as money–laundering that tempt you to use your bank account by offering a commission are an easy trap for unsuspecting customers to fall into.

However, it is important to know that you could wind up with a prison sentence too and ignorance is no excuse.

The Metropolitan Police also has a special Fraud Alert website, set up to assist in combating specific types of fraud, and to prevent you becoming a victim of crime.

When prosecuted in connection of any sort of financial crime ignorance won’t stand as an excuse so it is important to investigate anything you may think seems dodgy or too good to be true. The FSA website offers advice and information on this and is worth checking when entering any sort of financial deal, just in case.   

The author of this article is Mel Varley who is an experienced journalist specialising in writing about financial matters, specifically secured loans. She has held several positions for magazines and newspapers and has written hard copy and for online audiences, both in the UK and in her homeland of Australia.

This article does not represent ‘financial advice’ as each persons individual requirements will be unique to their needs. If there is something in the article which you which to rely on then please check those details with any person from whom you purchase any product or service.

The views in this article represent those of the author and not those of Netbasic Limited.

More than 70 per cent of adults in the UK say that fears of identity theft are changing their online behaviour, which could impact on future e-commerce revenues. 

According to a new survey, almost two thirds of consumers in the UK believe businesses should take more responsibility for protecting their personal details online.

Almost 84 per cent of respondents said that their trust in an organisation’s ability to protect their personal details dictated who they interacted with the most online.

The results reveal that online identity theft remains a major concern for consumers, which is not surprising considering that more than 170,000 cases of identity theft have been reported in the past 18 months.

Please note that identify theft can also affect your credit rating and that might damages your chances of getting much needed financial services such as a secured loan or a mortgage.

However, consumers still need to be convinced that rigorous steps are being taken by their banks to ensure their data is protected and that security is at the top of the agenda.

Banks, credit card companies and the Government are, to some extent, looking to further combat online identity theft and an area that needs urgent attention is breach notification laws.

This creates an additional need for organisations to not only do everything they can to minimise online fraud, but also to show transparency in their efforts.

Peter Gerrard, head of insurance research at moneysupermarket.com, said: “With the shocking news of 25 million people potentially having their personal and banking details in the hands of criminals, consumers need to consider how they can protect themselves.

There are a number of identity theft products on the market. Some of these are stand alone and some come bundled (often at extra cost) with other products, including home insurance, credit cards and current accounts.

Many of these products are dubious value for money. Most will cover losses if fraudulent transactions take place. However, if consumers are vigilant and report any unusual activity to their bank or card provider these losses will be covered by the provider as a matter of course anyway.

Other policies will provide credit reports and fraud alerts. Whilst these are useful they are no substitute for account holders being vigilant – for example by checking statements regularly.

The real cost of having your identity stolen or cloned is the time, stress and effort it takes to resolve the situation. Clearing your name and credit record, closing compromised accounts and opening new ones, as well as freeing up any cash that may be locked in compromised accounts often takes a huge toll on people. Also during the time it takes to clear up any records lenders may not be willing to provide you with competitive deals on things like secured loans.

Identity theft cost the UK economy £1.5 billion in 2005. To protect yourself from identity fraud a number of precautions can be taken and it is very important to organise an identity theft insurance package from your bank. Most high street banks will offer this when you first open an account.

Always check that the ATM’s you use are secure and in perfect condition and never give your credit card details to an unregistered website when purchasing items. Many payment facilities including PayPal have been set up to avoid this. Protecting yourself from identity theft is protecting your money and your right to privacy of information.

The author of this article is Melinda Varley who is an experienced journalist specialising in writing about financial matters. She has held several positions for magazines and newspapers and has written hard copy and for online audiences, both in the UK and in her homeland of Australia.

This article does not represent ‘financial advice’ as each person's individual requirements will be unique to their needs. If there is something in the article which you wish to rely on then please check those details with the person with whom you arrange secured loans, remortgages or other financial services.

The views in this article represent those of the author and not those of Netbasic Limited.

New restrictions on lending to high-risk customers could lead to a surge in the numbers of people seeing their mortgage applications turned down, according to new figures.

According to new research, a quarter of all specialist and sub-prime mortgage applicants accepted during last August would now be refused, following changes to lenders' rules.

Mortgage experts said the new tighter controls on Loan to Value (LTV) and credit history were likely to have a significant impact on low-income families or borrowers with a poor credit rating trying to get on the property ladder. This same market conditions will also impact on remortgages.

The figures suggest that the less well off are going to find it much harder to get their hands on a mortgage deal in future. The new changes are also likely to provoke a drop in the sub-prime market.

Many first-time buyers would be priced out of the market while homeowners looking to remortgage on a sub-prime deal might find themselves unable to make the repayments.

The sub-prime market is worth about £130 billion a year, including almost £30 billion in new mortgage deals. Brokers have been warning that the narrowing in availability of sub-prime deals could have severe repercussions for the economy.

The potential impact upon the economy may be considerably more than most commentators have stated as more and more people go into debt management and Individual Voluntary Arrangements (IVA).

There will also be even more home repossessions and the overall result will be a fall in house prices as the money to buy them simply contracts.

Another survey published recently also revealed that about 5 per cent of first-time buyers were leaving themselves vulnerable to a downturn in the housing market.

One in 20 new homeowners took out a 100 per cent mortgage, meaning only a slight fall in the cost of property would push them into negative equity. Borrowers on 100 per cent mortgage need to be aware that stagnant house prices may keep them shackled to their uncompetitive lender and prisoners in their own home until house prices rise again.

There are many ways of paying for a new home. There are also alternatives to buying such as renting or leasing. But what most people still report as their ultimate goal, is to own their own home, and the most common way of getting started with this goal is to get a mortgage.

There are many different types of mortgage and remortgages but they all have one common feature, they are secured over your home. This means that if you ever become unable to meet your repayments, your home can be seized by the bank who can then sell it in order to get back their principle.

When you’re shopping around for a loan, there are certain terms you will need to be familiar with. For example, mortgages generally come as either a fixed rate mortgage or a variable rate mortgage.

The fixed rate loan will keep the same interest rate and monthly repayment for the whole of the fixed rate period. For loans that could be the life time of the loan. This will generally be for a period of 5, 10 or 15 years. If the rate is fixed for a period, such as the first 2 or perhaps 5 years, and then reverts to a variable rate it is known as an adjustable rate mortgage or ARM.

If you find that you are not offered a mortgage there are a number of things you can consider doing such as renting or leasing a home. This should be easier to get approval for. You may also consider saving up for a larger down payment. This will also make approval more likely.

The main thing you should consider however, is working on fixing your ailing credit score by getting your debts under control and making your repayments on time.

The author is Melinda Varley who an experienced journalist currently specializing in articles for the financial field. Melinda has held several positions for magazines and newspapers both hard copy and online and both in the UK and Australia which is where she originates from.

This article does not represent ‘financial advice’ as each person's individual requirements will be unique to their needs. If there is something in the article which you wish to rely on then please check those details with the person with whom you arrange a secured loan, remortgage or any other financial service.

The views in this article represent those of the author and not those of Netbasic Limited.

Despite its recent poor reputation, equity release is becoming increasingly popular and industry experts say the quality of the deals is improving along with the advice.

Those heading for retirement are warming to the idea fastest as one in 10 people aged between 50 and 56 said they would consider equity release in future.

However, those already retired are less enthusiastic with only one in 20 thinking equity release would be sensible.

Demand is up 10 per cent this year on 2006 with the amount of equity being withdrawn by older homeowners up by 26 per cent in 2007, taking the total to above £1 billion for this year.

More than 22,000 households have signed up since January, releasing an average £49,000 of equity compared with £42,100 in 2006.

For many older homeowners, tapping into their property's value is the only solution to money worries. Many are considering a secured loan to bring in much needed funds.

However, don’t consider an equity release deal without first thinking of other cheaper, simpler ways of finding money, perhaps through downsizing, selling other assets, or even coming to an informal arrangement with close family.

Read as much as you can about different schemes and seek help from an independent adviser who is able to recommend deals from numerous companies, or seek information from at least two rival firms. Invite a family member to attend adviser meetings.

Consider a wide range of future scenarios, including how long you might live, what would happen if you needed care, and whether you would easily be able to move home.

Rising prices often hit the elderly harder than anyone else. Many of them have to get by on fixed incomes and may be forced to dip into savings to pay their everyday bills.

Increasing numbers of older people are turning to equity release as a way of raising much-need funds, but it is important to consider the alternatives first such as moving to a smaller home. Capital raised this way will cost you less in moving expenses than in equity release set-up charges and interest.

If you do not wish to move, it is essential to discuss your plans with your family before proceeding with equity release. This will avoid any unnecessary family surprises later on and they may be able to suggest alternatives.

With more than 30 equity release schemes available it will be difficult to find the best deal yourself. Not only that, many of the schemes are available only through authorised intermediaries. So find an independent specialist in equity release advice.

Choose your adviser carefully and make sure they are conversant with all aspects of long-term care funding. Some of this may be relevant to you now or in the future. The wrong advice could cost you dearly, an adviser who specialises in all these areas will be able to explain all the relevant issues and achieve the best outcome.

Ask your adviser about equity release fees – and make sure you get value for money. Borrow only as much as you intend to spend or give away. You will earn much less from cash left on deposit than the interest you will have to pay for borrowing it in the first place. It could also cut your entitlement to means-tested benefits.

When comparing lifetime mortgage interest rates always pay particular attention to the APR and not just the headline rate. The difference can add up to 0.5 per cent on the rate actually charged. This is due to the costs of setting up the arrangement and how interest itself is calculated.

Ask your adviser about continued support and advice. This could range from claiming welfare benefits, or care and support from the local authority, to mitigating inheritance tax.

Clearly, the equity release market is set to grow. But there are other choices available and homeowners should approach the decision with caution. Certainly check out all options first and discuss it with an adviser and family. Never be pushed into taking out a loan.

 The author is Melinda Varley who is an experienced journalist currently specialising in articles for the financial field. Melinda has held several positions for magazines and newspapers and has written hard copy and for online audiences, both in the UK and Australia, which is where she originates from.

This article does not represent ‘financial advice’ as each person's individual requirements will be unique to their needs. If there is something in the article which you wish to rely on then please check those details with the person with whom you arrange secured loans, remortgages or other financial service.

The views in this article represent those of the author and not those of Netbasic Limited.

Banks want to attract you, but will you be accepted?

Savers are benefiting from a spell of record interest rates as banks and building societies battle to attract funds to offset a further tightening of the credit market.

Several savings providers have launched new deposit accounts with fixed rates close to 7 per cent with many of these deals selling out within days.

Savers have been the big beneficiary of the current market difficulties as banks are in a period of better rates as the current credit conditions make it more difficult and more expensive to obtain wholesale funding and secured loans.

Providers that are less exposed to the credit markets are also offering higher rates to keep pace with the larger banks.

Several small building societies have been paying 6.9 per cent on fixed-rate bonds, while large high street banks have relaunched more attractive current accounts.

Financial advisers say it is extremely unusual to see savings rates rise when there is such a strong expectation that base interest rates had peaked.

The feeling is that interest rates will come down, yet we are still seeing high savings rates. Savings rates topped 7 per cent for the first time in six years at the height of the credit crisis in September but soon fell back closer to 6 per cent.

However, banks are again in need of cheaper short-term money. Lenders are having to examine different funding routes and customers are their main source of income.

On the other hand, one in three mortgage holders could face serious financial difficulties as the credit crunch starts to hit and banks and building societies are becoming increasingly strict on what terms they lend money. Mortgages and loans are becoming harder to get for those will less than perfect credit history.

According to the market research firm Mintel, 37 per cent of all mortgage holders, some 4 million households, would now be classed as either sub-prime or high-risk.

This means they stand a high chance of being offered less favourable terms when they come to remortgage or a loan. The research comes as experts suggest that 15.3 million consumers felt worse off than earlier this year.

According to this survey, 5.8 million adults say they need credit just to help meet their living costs, with the average person having to hand over 53 per cent of their monthly take-home pay on debt repayments.

Meanwhile, people coming off a fixed rate mortgage will face higher repayments and a rise in arrangement fees. Two years ago the average arrangement fee was £441, today it stands at £827.

While the banks will always work hard to attract new customers, they are also becoming increasingly picky as to who they accept as customers. While many of us may benefit from high street banks’ increased marketing activity and incentives to join them, some of us will be left red faced and classified ‘high risk’ due to the credit crunch.

To ensure you get the best deal and aren’t turned away should you apply for a loan or attempt to remortgage, shop around for the best deal and an account system that works for you in terms of interest rates and benefits.

The author is Melinda Varley who is an experienced journalist currently specialising in articles for the financial field. Melinda has held several positions for magazines and newspapers and has written hard copy and for online audiences, both in the UK and Australia, which is where she originates from.

This article does not represent ‘financial advice’ as each person's individual requirements will be unique to their needs. If there is something in the article which you wish to rely on then please check those details with the person with whom you arrange a secured loan, remortgage or other financial service.

The views in this article represent those of the author and not those of Netbasic Limited.