http://www.opendoorsmoney.com/content/features Advice, information and resources on debt related issues including debt management plans, IVA's and Bankruptcy. en contact@flgmoney.co.uk Copyright 2009 2009-05-05T16:57:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/the_true_price_of_little_luxuries/ http://www.searchclickmoney.co.uk/index.php/site/the_true_price_of_little_luxuries/#When:16:57:00Z If you’re struggling with large debts running into many thousands of pounds, it’s difficult to seriously see how saving relatively small amounts of money can make any kind of difference whatsoever. But it’s exactly this sort of thinking that gets people into difficulty in the first place. Let’s take coffee as a small example. After all, over the last decade or more, the number of trendy coffee shops on the high street seems to have quadrupled. And it’s not surprising – their coffee is excellent compared to what we used to get. But let’s be honest, it’s not all about taste. It’s also a lot to do with its trendy status. A big coffee cup is the accessory no self-respecting twenty-something year-old can be seen without these days. But two large coffees each working day amounts to around £136 a month. And when you subtract the average young person’s likely spend on Council Tax, rent or mortgage, food, clothes, utilities etcetera, this is a staggering percentage of true disposable income.  As an illustration, let’s presume someone gave up coffee for good – and invested that money, making 6% a year in dividends from shares, for example. After five years, the investment would be worth almost £10,000 - even if the shares were at the same price.  Take that forward for another five and now we’re really talking at £22,600 and after 20 years, you’ve managed to amass over £63,000, simply by refusing to buy into the trendy brand mentality in one small area of day-to-day living, even in the unlikely event that the shares had never improved at all.  In other words, prudence with the little things in life can pay off handsomely in the long run if you save and invest. Unfortunately, when you’re in debt, the exact opposite scenario is true – which is why people find their debts spiralling out of control. If you’re one of them, do everything you can to make even a small difference each month – and always seek expert personal debt advice 2009-05-05T16:57:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/dont_trust_property/ http://www.searchclickmoney.co.uk/index.php/site/dont_trust_property/#When:22:06:00Z The ethos in the UK over the past decade or so has been to somehow equate economic success with rises in the value of houses. This misinformed view has contributed hugely to our current economic woes and the fact that so many people are now struggling with debts, mortgage arrears, and rent arrears. Now, news that the growth in mortgage lending is likely to continue, according to figures from the Bank of England, has led to optimism that the housing market will recover. Prices are 20% down from their July 2007 peak, and with mortgage rates at record lows, quite a few pundits are speculating that it’s time to get back into property. This is a very dangerous game. It’s true that there are some excellent mortgage deals around for those who can afford to stump up the 25% deposit required. And this may well be an ideal time to consider re-mortgaging if you can; particularly as you can benefit from current low base rates for up to 15 years. But the average price of property remains way out of kilter with average earnings when compared to all the historical data available. The long term average has been for the average house price to be around 3.5 times the average salary. Even after the recent house price falls, the current figure is around seven times. And that’s with interest rates at anomalously low levels as the Bank of England tries to encourage some confidence. What will happen when interest rise even slightly as they surely will? Add to that the fact that around a million people seem likely to lose their jobs this year, and you can quickly see what’s more likely to happen to house prices. On an investment basis, property still makes no sense, on the whole, whatever the pundits say. One of two things is required before property makes sense; either wages will have to rise quickly, or prices fall. If you’ve been drawn into the kind of erroneous thinking that states that property always goes up, don’t get suckered in again – but do do everything you can to hang onto your house and job. On this site, you’ll find a wealth of advice about getting yourself into the black and staying there – or about the different ways of dealing with your debt problems, even if they seem insurmountable. But don’t trust property as a way out – certainly not yet anyway. 2009-05-04T22:06:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/household_burglaries_increase_as_recession_tightens_grip/ http://www.searchclickmoney.co.uk/index.php/site/household_burglaries_increase_as_recession_tightens_grip/#When:17:18:00Z Since the recession tightened its grip on the personal finances of individuals across the UK earlier this year, homeowners have been provided with many reasons to worry. The majority of these concerns have revolved around how to pay the next electricity bill whilst coping with rising food prices at a time when redundancies and pay cuts are becoming the norm. However, last week, the leading insurer in the UK, Norwich Union, revealed another reason to feel anxious: a fifty per cent increase in household burglaries could be recorded by the end of this year. As unemployment spreads across the country, desperation and criminality are sadly following in its footsteps and the insurance company has revealed its fears that homeowners in the UK face losing approximately £421 million in stolen belongings. The economic crisis has seen many individuals falling into the vicious circle of debt and becoming the victim of a burglary can be a further blow to personal finances.  As is often the case when potentially alarming statistics such as these are unveiled, many people have started to panic unnecessarily. Whilst Simon Warsop, the director of home pricing at Norwich Union, was keen to express his concern about the figures, he was also quick to point out that people should not feel like helpless victims of crimes waiting to happen. Warsop stated that “these figures don’t have to be inevitable: ensuring windows and doors are properly locked, sheds are secured and properties kept in good order can all deter the opportunistic burglars”.  Following these simple guidelines will ensure that you are giving yourself the best chance of escaping opportunistic burglary and the financial ramifications which can arise from such events. Remember that the impact of burglary upon your personal finances can be minimised by taking out a proper insurance policy and you should make sure that all your valuables are listed under this policy. Norwich Union revealed that the prime targets for opportunistic thieves include games consoles, DVDs, cameras, personal computers, and mobile phones. If you are struggling to cope with debt at this time of financial uncertainty, you should consider contacting a professional personal finance company for help drawing up an effective debt management plan. 2009-05-03T17:18:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/earn_100_to_help_escape_debt/ http://www.searchclickmoney.co.uk/index.php/site/earn_100_to_help_escape_debt/#When:12:24:00Z If you’re struggling with paying off debt effectively, or making a determined attempt to remain debt-free in the current economic climate, £100 could be the helping hand you need. For the best part of a year now, it seems as if the news has been dominated by financial negativity and money worries seem, understandably, to be heading the list of anxieties impacting upon every household across Britain. It is refreshing in the face of this doom and gloom to see Alliance & Leicester doing what they can to encourage a sense of positivity in the UK. Individuals are currently being offered the chance to boost their personal finances by taking advantage of an offer provided to those who switch to Alliance & Leicester from the beginning of May. These individuals will be offered £100 if they switch to the Premier Current Account or the Premier 50 Current Account. Applying is relatively straightforward, which is also a refreshing change in this era of financial complexity. The Current Account Manager at Alliance & Leicester has spoken about the motive behind the new offer. Gillian Almond revealed that at a time during which “Alistair Darling and his team have been reviewing the country’s finances”, it only seems right that individuals should be provided with the opportunity to “get more bang for [their] buck” by reassessing what existing “current account[s] offer” in terms of financial bonuses. Having said this, Almond was keen to point out that taking advantage of financial incentives such as these is only one way to ensure that you remain debt free over the coming months, which are set to provide UK homeowners with more worries about their bank balances. For instance, it is essential that individuals review their direct debits to see precisely how much money is coming out of each account. There may be non-essential payments, such as gym memberships, that can be cancelled, which will decrease the strain on your personal finances.  For help with any aspect of debt management, contact a professional debt solutions company for impartial advice. 2009-05-02T12:24:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/the_homeowners_mortgage_support_scheme/ http://www.searchclickmoney.co.uk/index.php/site/the_homeowners_mortgage_support_scheme/#When:17:10:00Z If you’re worried about being able to keep up with your mortgage payments, there’s a new Government scheme that may be able to help. Called the Homeowners Mortgage Support Scheme, it is designed to help homeowners stay in their homes during economic crises. If your mortgage is with one of the lenders that have signed up to the scheme and you get into financial trouble, you may qualify to make reduced mortgage payments and to defer the remained of your payments for up to two years. The government will then guarantee 80% of the interest repayments you weren’t able to make if you then have to default on the mortgage. Basically, the Homeowners Mortgage Support Scheme is designed to help homeowners, who have temporarily lost part of their income, to keep their homes. So what will happen? If you apply for the scheme, you’ll initially be referred to an independent money advisor who will explain how the risks and benefits will affect you. If, having had the advice, you decide that the scheme is something you want to proceed with, then you’ll be able to defer up to 70% of your monthly payments for up to two years. But bear in mind that any money you defer paying will be added to the mortgage - and will have to be paid back, with interest, when your payments resume. In other words, you may later have to increase your payments or increase the length of your loan. The scheme is, therefore, an excellent way of seeing you through the hardest of times and helping you to keep your home – should the need arise. However, in order to qualify, you’ll need to meet the following criteria: -You must be suffering a temporary loss of income – and monthly payments can only be cut by a maximum of 30%, so you’ll need some income. -You must be an owner-occupier with a mortgage of less than £400,000. -You must have less than £16,000 in savings. -You must have bought your home before December last year. -You must have talked through other possible options with your lender and you need to have been making regular payments for at least five months. On the other hand, you won’t qualify for the scheme if: -Your lender isn’t part of the scheme. -You own more than one house. -Your income is unlikely to return to its previous level. -You have insurance that protects your mortgage payments. -Your lender thinks you won’t be able to keep up with your monthly payments, even if they are reduced. -You are claiming Jobseeker’s Allowance If you’re worried about being able to keep up with your mortgage payments, take action. Communicate with your lender as soon as possible. And if you’re in debt, take expert personal debt advice as soon as you can – there are many different ways out of your situation. 2009-05-01T17:10:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/good_news_for_people_in_debt_from_the_csa/ http://www.searchclickmoney.co.uk/index.php/site/good_news_for_people_in_debt_from_the_csa/#When:16:53:00Z If you’re struggling with debts, there’s a little good news from the Credit Services Association (CSA) which has come to a new agreement with the government. From the end of May, debt collectors have agreed to give 30 days’ breathing space to people trying to sort out their finances. In practice, what this means is that you have additional time to get to grips with your debts and do something about them, without being hassled by creditors or those acting for them. The CSA has acknowledged that the current economic environment is placing greater pressure on debtors – and that debts are being passed to agencies for collection. It says that it is doing all it can to improve the relationship between creditors and debtors, and this is the first in a series of announcements it expect to make in the coming weeks, so there’s a chance of more good news in the pipeline. However, if your creditors are chasing payments, then it’s vital you seek help from an accredited debt advisor for the new agreement to apply. But even more importantly, you must face up to your debt problems. There are many steps you can take to fight back against debt and undoubtedly, the most important one is to acknowledge all your debts, total them up and look at your interest payments. Also, communicate openly and honestly with your creditors. Believe it or not, they may be able to help and – as long as they’re reputable companies – they should act in a responsible manner. They may even agree to a payment holiday or to renegotiate your repayment plan. 2009-04-30T16:53:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/avoiding_debt_after_the_breakdown_of_a_relationship/ http://www.searchclickmoney.co.uk/index.php/site/avoiding_debt_after_the_breakdown_of_a_relationship/#When:20:58:00Z When a relationship breaks down, the emotional trauma can be significant. However, unfortunately, relationship breakdown is a common cause of debt. Many individuals who have coped well financially as part of a couple can find themselves in severe economic trouble once separated from their partner and, although it can be very stressful if you find yourself in this situation, you need to remain focused and clear about your financial rights. You may be entitled to child maintenance, which will provide you with payments on a regular basis to help with the everyday costs of caring for a child. If you have been left alone with your child, your partner will need to pay this maintenance to you but setting up such an arrangement can be difficult. Some couples are lucky enough to part on good terms, which makes financial discussions easier. However, many individuals find any communication with their ex-partner stressful and assistance is available if this is the case.  If you decide not to sort out the issue of child maintenance between the two of you, the amount paid to the partner caring for the child will be calculated using criteria including the number of children involved, the net weekly income of the parent who is not responsible for the daily care of the child or children, and the amount of time that the parent without the main responsibility for providing daily care has the child for during a typical year. Although starting the process of receiving child maintenance can be stressful, it is very important that you maximise incoming finances. If you are entitled to additional income, you really need to make sure you receive it. Caring for a child can be extremely taxing on the finances and, if you fail to take advantage of payments such as child maintenance, you could find yourself struggling with debt. For help dealing with debt, contact a professional debt solutions company. 2009-04-29T20:58:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/cash_back_credit_cards/ http://www.searchclickmoney.co.uk/index.php/site/cash_back_credit_cards/#When:16:40:01Z Halifax has re-launched its cash-back credit card. The card is supermarket-linked allowing you to earn 1% cashback on your grocery and fuel purchases, as well as 0.5% on all other purchases for your shopping basket. Great – or is it? Well yes and no – it all depends how you use it. If you’re struggling to pay back debts, such deals may look tempting. But be very, very, careful. If you’re the type of person who has already run up credit card debts and you’re struggling to pay off these and/or other debts, then can you really trust yourself to use such a credit card to its best extent? If so, then great; use it to maximum efficiency. But if not, look at the “typical” rate APR of 15.9% and ask yourself if you can really affords that level of interest repayment. Of course credit cards aren’t inherently bad and they can be excellent tools for thrifty people when used effectively. But those kinds of people aren’t really likely to be reading this article. And for people in debt, generally speaking, credit cards are the biggest debt culprits in the UK today, but they prey on those least able to afford further debt. In fact, it’s usually better to take out alternative loans to pay off your credit card debts – as credit card debts are usually some of the most expensive types of debt around. A consolidation loan can be a good option, but again, only if it’s used wisely rather than as an excuse to spend more and take on even more debt.  If you’re in debt, there are many steps you can take to dig yourself out, the most important of which is to face up to your problems and seek expert personal debt advice. 2009-04-28T16:40:01+00:00 http://www.searchclickmoney.co.uk/index.php/site/debts_under_5000_and_a_ccj/ http://www.searchclickmoney.co.uk/index.php/site/debts_under_5000_and_a_ccj/#When:16:45:00Z If you have total debts of less than £5,000 and are struggling to pay them off – and have at least one County Court (or High Court) Judgement issued against you – then an administration orders may be a good solution. Perhaps the best thing about an adminstration order is that it gets the creditors off your back – and that it is couched in legal terms. In other words, if you are faced with hassle from creditors after an administration order has been made, then those creditors face potential prosecution. An administration order is a court order which covers all your unsecured debts. This means you make one regular payment and the court distributes it on your behalf to all your creditors. Under the terms of an administration order your creditors are not allowed to take any kind of action against you once the order is in place – nor to demand money in any way.  You only have to make one monthly payment – and that payment is based on what you can afford; most usually over a three year period. The downside is that the court charges you for this service and the fee may be anything up to 10% of your total debt. This amount will be taken before payments to your creditors are made and if you miss a payment the arrangement may not be valid. Nevertheless, an administration order brings clarity and peace of mind to many people who were previously struggling to make payments and who may have been facing aggressive and/or unreasonable demands for payments from creditors. If you think an administration order is the right solution, you have to apply directly to the court. You will need to complete form N92, which can be obtained from your local court office. You’ll need to include all your debts - whether they are in your name only or not. The court will usually take payments directly from your wages – though you can specify that you do not wish to pay it this way. If you’re struggling to pay off your debts, there are many steps you can take, but it’s essential to take expert personal debt advice as soon as you can. 2009-04-27T16:45:00+00:00 http://www.searchclickmoney.co.uk/index.php/site/six_simple_steps_to_reclaiming_unfair_bank_charges/ http://www.searchclickmoney.co.uk/index.php/site/six_simple_steps_to_reclaiming_unfair_bank_charges/#When:20:35:00Z If you have discovered that you are living in financial hardship (and this opinion adheres to official criteria regarding this status) and you decide to reclaim bank charges deemed unlawful, there are several steps that you should follow. 1. Contact your bank to find out how much you have been charged. Try going back as far as summer 2001 (although bear in mind that you may not, in reality, be able to claim charges back this far) 2. Write an official letter to your bank asking for the bank charges to be paid back to you 3. Make sure you state clearly and officially that you are currently in financial hardship and you wish your claim request to be regarded under the hardship rules 4. The bank may agree to your request but they may also refuse to pay you the charges 5. In this instance, contact the Financial Ombudsman for free. It is really worth standing your ground, even if your bank refuses to pay initially, since you could be entitled to thousands of pounds 6. You will then be able to establish who is in the right, and, if you are actually living in financial hardship, the likelihood is that the Financial Ombudsman will rule in your favour Claiming back bank charges when you’re not officially in financial hardship is also possible but the process is likely to be far more complicated and drawn out. The outcome may also be less favourable in the short term for you. If you are not in financial hardship according to official bank criteria but are still struggling with debts, contact a professional debt management company for help managing your money and tips on how to get out of debt. 2009-04-26T20:35:00+00:00