accepted.co.uk - the loans search engine

The Government have launched a new helpline for victims of loan sharks. Consumer Affairs Minister Gareth Thomas announced the introduction of the new helpline during a Trading Standards Institute conference in Bournemouth.

The helpline will be available to people in Yorkshire, Humberside and Central England, as well as those in the South East and North West. Run by a team of workers from Birmingham City Council, it is hoped it will help vulnerable people who have been targeted by unscrupulous loan sharks.

Commenting on the initiative, Gareth Thomas said, “It takes a real low life to prey on vulnerable people and bully and intimidate them out of their hard-earned money.

”This team is having great success cracking down on these criminals and supporting their victims.

”I want to encourage anyone who has been affected by a loan shark to use the new helpline and come forward in confidence. Any information, however small, on loan shark activities will help the team to take action.”

A loan shark is a business offering loans without a licence from the Office of Fair Trading. If you worry that you might have been targeted by a loan shark, the Loan Shark Project will be able to help you.

All financial experts agree that making an important financial decision such as taking out a secured loan or homeowner loan should never be taken lightly. Whether it is to finance a holiday, a new car, a wedding or some long-desired home improvements, the benefits of taking out a secured loan should always be thoroughly investigated.

Yet, according to Swiss insurance giant Zurich, relatively few UK consumers have ever consulted an independent financial advisor. Research by the insurance company reveals that only 57% of all over-eighteens in Britain claim to have visited an independent expert to receive financial advice.

Tony Solomon, director of life marketing with Zurich, comments, “The decision to seek financial guidance is a step in the right direction towards setting up a long-term plan to survive the credit crunch and prepare financially for their old-age.”

A good financial advisor is able to offer guidance on most important money decisions, including mortgages, pensions, investments and secured loans.

The number of so-called payday loans taken out by UK consumers has risen by around 130% in the past ten months, according to price comparison website moneysupermarket.com.

 Payday loans are short-term loans taken out by consumers to cover cash shortfalls, usually in the days before they are due to receive their monthly salary. However, they come at a price, with a typical £100 loan costing around £25, even if it is paid back at the earliest time possible.  

The annual percentage rate (APR) of these loans is even more crippling, with one well-known lender admitting that their APR works out at around 1355%, a figure which is reasonably representative of the APRs offered by their UK competitors. Such punitive interest rates compare unfavourably with those offered by credit cards, secured loans, homeowner loans and most overdraft facilities.  

Chris Tapp, of debt charity Credit Action, commented, “Over the past year, payday loans have become an issue in the UK, and the growth in people who have problems who have such a loan has been notable in the last six months.”

The owner of a Cardiff-based secured loans company has bought out his majority shareholders. The move is seen by many as a welcome assurance that there are business leaders in the UK who still have plenty of confidence in the economy, despite media speculation of impending economic crisis. 

The secured loans company, which employs around 70 staff at its Cardiff office, was formed seven years ago, assisted by the capital of prominent Monaco-based venture capitalist Marc Bertola.  

Now Bertola has been bought out, marking an important development in the life of the secured loans company, which used to employ just three staff but now has a workforce of 70 operating from a high-tech purpose-built office.

British university students and university graduates have been urged to manage their loans sensibly. And with a recent study by bank NatWest calculating the average level of student loan debt at £12,363, it seems many need all the advice they can get.

Richard Brown, Chief Executive of moneynet.co.uk, an online secured loan provider, advised debtor students that they should seek to prioritise repayment of credit card debts over the student loans they have incurred.

He said, “You have a very long window to repay student debt - nobody is saying that you should be cavalier about this as some people graduate with substantial student debt but it is a fact of life unfortunately, whereas carrying big wads of debt on a high interest credit card isn't.”

One debt students are unlikely to have, except perhaps mature age students who have taken out a homeowner loan in order to fund their further education, is any form of secured loan.

New research from Lloyds TSB has revealed a paradox in the financial habits of UK consumers. For while 80 percent of people will look for cut price deals on even the most meagrely-priced products, and 28% like to reuse teabags, relatively few look around for the best deal on significant things like homeowner loans and mortgages.

In a surprising contrast, 61 percent of consumers said they would visit a pound shop to find the cheapest possible product, yet only eight percent said they would scout the market for the best deal on things like car and secured homeowner loans.

The Lloyds TSB survey participants gave various reasons for their reluctance to shop around when making important financial decisions such as choosing a homeowner loan.

Some cited scepticism as a factor, saying that they believed shopping around was unlikely to provide them with a cheaper product.

Others said that looking around was too much trouble, clearly indicating that, for some, second-best is good enough.

However, a spokesperson from Lloyds TSB warned that by taking this approach, many UK consumers are losing out. She said, “By watching the pennies it’s easy to lose sight of the pounds.

“Being careful with your spending is wise but to really boost your bank balance you should take a long hard look at the financial products you have.”

Secured loans broker Loanmakers has reported that its share price has fallen by 18%.

The news follows an earlier announcement to the stock exchange that the secured loan player had posted a pre-tax loss of £8.4 million for the financial year ending in March.

This loss marks a dramatic turn of fortune for the broker, who reported a £7.8 million profit for the same period the following year.

It has been a busy and difficult fiscal twelve months for the company, perhaps most notably because of their decision to sell their Individual Voluntary Arrangement business and instead focus on secured loans.

This decision to drop the IVA side of their operations has had an inevitable impact for staff of the Bolton-based company, with 115 job losses, including 10 forced redundancies, resulting.

The secured loan broker’s chairman commented that its financial year had been “extremely disappointing”. Adding that, “Whilst current trading for Loanmakers is challenging, the board believe business still has the potential to deliver good growth and accordingly has been examining ways to strengthen the company’s balance sheet.

“We are well aware that shareholder confidence is at a low level but in order to deliver value in the future the board’s strategy is to support the Loanmakers business until confidence returns to the market.”

Picture Financial, a company that offers both secured loans and consolidation loans, has terminated the employment of around half of all its staff.

Eighty-five jobs are believed to have been lost at the Newport-based loan provider as a result.

While some have speculated that this move can be seen as a reflection of an increasingly troubled UK economy, others believe the reasons for the job losses may be more complex.

Only two months ago, a study by Nielsen Media Research showed that Picture Financial had made astonishing cuts in its advertising spend, falling from £4.8 million to just £306 in the first quarter of 2008.

A visit to the secured loans company’s internet homepage reveals that they are still available to deal with the loans of existing customers. However, a statement outlining their current stance on new customers reads:  “In response to current economic conditions, Picture is taking the opportunity to re-shape its products to ensure that we continue to maintain the highest levels of competitiveness and service.

“To allow us to focus on this process we are currently not taking new business but hope to be back very soon helping our customers to significantly reduce their monthly credit repayments, so please visit our site again soon.”

In keeping with its announcement that it plans to axe 9,000 jobs globally, Citigroup has closed its secured loans and homeowner loans arms in the UK.  

Based in Sunderland, CitiFinancial offered secured loans to consumers on the UK market and employed some 600 workers, with around 400 of those based in its Sunderland office.  

Much of this is attributable to the fact that CitiGroup have been hit hard by losses in the US sub-prime lending market, making a loss of £2.7 billion in the first quarter of this year.  

Bert Pijls, business manager for CitiGroup’s UK consumer business commented, “Following a strategic review of the consumer business in the UK, Future Mortgages and CitiFinancial were not identified as areas for strategic growth.  

“By proposing to focus resource on our Citi and Egg brands, we are reflecting Citi's global strategy and creating a platform for expansion in the UK personal finance market.  

“We are committed to ensuring that staff who are potentially impacted by these proposals are treated fairly and made aware of all the options open to them.”

CitiFinancial had around 66,000 secured loan and homeowner loan customers. The loans of these customers will now be managed elsewhere within its business operations.

The Association of Finance Brokers (AFB) has announced that it is accepting nominations for positions on its board. Candidates will have an opportunity to influence the industry, including the future of both homeowner loans and secured loans.

Three positions on the board are open. One position will go to a candidate from a small firm, one to a candidate from a medium firm and one to a candidate from a large firm. This split exists so as to ensure a fair and balanced reflection of the loans market.

In order to be eligible for election, candidates must receive two nominations from other AFB members and complete a nomination form.

Both Paul Carley, who currently represents small firms, and Steve Feeney, who currently represents medium firms, are standing for re-election.

Robert Sinclair, director of the AFB comments, “We are an open and transparent body, which is fully representative of its members and their interests, and we welcome all nominations to the Board.
 
“These are challenging times for the industry and the wider economy and it is more important than ever that the industry has a strong trade body representing its interests with regulators, politicians and the media.

“However, we are only as strong as our members make us. That is why it is vital we have engaged members who are willing to serve on the Board. The secured loans industry faces a number of key challenges this year and sitting on the AFB Board offers a great opportunity to influence the future shape of our industry.”

To nominate someone from the homeowner loan and secured loan industry, find out more from the Association of Finance Brokers.

The latest financial statistics for June reveal that the total level of personal debt in the UK has risen to £1,436 billion, a rise of £6 billion on the previous month. At £1,207 billion, homeowner mortgages account for the majority of this figure, while the total figure owed in secured loans stands at £6.4 billion.  

Although secured loans represent just a fraction of the total overall figure, it could be that they may have played a part in the 8.4% rise in total money owed that has been witnessed over the past 12 months.

It would appear that high levels of personal debt are becoming a defining characteristic of the current UK economy, with the average British person owing more than £30,000. Average household debt is even higher, standing at nearly £60,000.  

Looking only at households that have mortgages, these figures skyrocket, as families with mortgages on their homes owe an average of £102,070.  

And with the total of level debt increasing by around £1 million every five minutes, secured loans undoubtedly account for a fraction of this figure.

Worries over the standard and choice of state education coupled with the increasing price of the cost of living are prompting large numbers of parents to take out secured loans in order to fund the private schooling of their children. 

Researchers from Sainsbury’s Finance have been busy analysing Government statistics and have found that last year nearly 20,000 loans, including many secured loans, were taken out to meet the cost of school tuition fees. 

A 6.2% rise in the cost of school fees is another explanation for this phenomenon, with the most recent available figures showing that the average cost of yearly tuition has risen to £11,250. 

A spokesperson from Sainsbury’s Finance commented, “A combination of a rise in the cost of living, more children going to private school and the cost of private education rising could lead to more parents taking out loans to help fund their children's education.” 

It is anticipated that if the cost of private education continues to rise, so could the size and number of secured loans taken out to meet this expense. The size of average loan taken out for this purpose currently stands at £9,065.

Financial experts are predicting that one knock-on effect of the current conditions of the UK housing market will be a surge in the number of people taking out secured loans in order to carry out home improvements. 

In the light of an uncertain housing market, the DIY option is becoming increasingly attractive to homeowners, with Halifax reporting that as many as 28% have plans to renovate, extend or redecorate their homes over the next 12 months. And many choose to do so by taking the secured loan route. 

Neil Hoare, associate director of marketing and IT at Pink Home Loans commented on the present financial climate, saying, “Traditionally we see two spikes on applications each year, one just after Christmas when people look at their credit cards and want to consolidate, and one starting around April.

“This year we are expecting an increase in the number of applications for home renovations. There is a fair bit of uncertainty about and I think people will want to sit tight rather than take a gamble on buying a new property. 

“Intermediaries are focusing on alternative ways of generating income and secured loans have become a real asset in the intermediary market. 

“In the past, high fees and early loan payment charges were quite off-putting I think to clients and brokers, but now with better regulation and better training available, I think the online sourcing has become a lot more attractive.” 

To find yourself a suitable homeowner loan, search now.

The US Congress has passed a bill that will allow American servicemen and their families access to cheap homeowner loans.    

The bill, which carries the acronym HEART, meaning Heroes Earning Relief and Tax Act, also contains other provisions designed to assist hard-up war veterans and their families. Among these is a plan to allow active duty reservists to tap into their retirement plans without suffering punitive financial penalty.   

It is not only the predicament of servicemen the bills authors have considered. Small business owners too, many of who find themselves short-staffed and out-of-pocket by call-ups of reservist staff, will be given tax breaks to soften the blow of losing employees to the military.   

Overall, the HEART package is believed to be worth around $2 billion, with the majority of the money being poured into the cheap homeowner loan scheme.   

It was passed unanimously by the Senate, with neither Democrat or Republican senators willing to oppose a bill which has gained widespread popular support.   

It will now be handed to President George Bush, and only requires his signature before it officially becomes legislation. It will then come into effect, not inappropriately, on Memorial Day.   

Although it has been hard to find any public opposition to the bill, some have criticised it as being “too little, too late”, as many war veterans have recently returned from service in Iraq and Afghanistan to impoverishment, post traumatic stress disorder and unemployment.