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FSA and CML deliver verdict on repossessions
The Council of Mortgage Lenders (CML) has downgraded its repossessions forecast by 10,000 properties. It now predicts that 65,000 properties will be repossessed by the end of 2009, down from an earlier prediction of 75,000. They have also reduced the number of homeowners they predict will be in arrears by three months or more at the end of this year, down to 425,000 from 500,000 homeowners.
The Financial Services Authority (FSA) however also released figures this week reporting a 63% rise in repossessions during the first quarter of 2009 compared to the same period last year. According to the FSA, 14,825 properties were repossessed during the first quarter of 2009. Similarly the number of homeowners in arrears increased to 398,991 at the end of the quarter, compared to 299,588 in the same period in 2008.
The CML and the FSA appear to be displaying contradictory messages, however what remains clear is that the housing market continues to struggle. What these figures do suggest is that repossessions are definitely higher this year than they were in 2008, but perhaps the numbers will not be as bad as originally predicted. Experts have forecast that repossessions could still increase as unemployment increases and interest rates rise. If you are worried about repossession, see this helpful information from Credit Action .
Here is a review of the other top money stories of the past week commencing 22 June 2009.
Wednesday 24thJune
Hull named young jobless capital – Research by the Centre for Cities research group has revealed that Hull has the highest proportion of young unemployed people in the UK, with 9.85% of people under-25 unemployed. Other cities hit hard include Sunderland, Barnsley, Huddersfield and Liverpool. At present 40% of the total number unemployed in the UK are between the ages of 16 and 24. The International Labour Organisation (ILO) has forecast that 2.94million people will be unemployed in the UK at the end of 2011, of which 1.18million would be below the age of 25. Despite the government introducing measures such as the Future Jobs Fund, experts fear that this will not be enough to address the young unemployment problem.
35,000 shops to go by the end of the year – Experian, a credit referencing company, has forecast that as many as 35,000 retail shops will close down by the end of December. With the retail sector accounting for one in nine jobs, these latest figures could indicate a significant increase in the number of unemployed in the retail sector by the end of the year.
The Financial Services Authority (FSA) however also released figures this week reporting a 63% rise in repossessions during the first quarter of 2009 compared to the same period last year. According to the FSA, 14,825 properties were repossessed during the first quarter of 2009. Similarly the number of homeowners in arrears increased to 398,991 at the end of the quarter, compared to 299,588 in the same period in 2008.
The CML and the FSA appear to be displaying contradictory messages, however what remains clear is that the housing market continues to struggle. What these figures do suggest is that repossessions are definitely higher this year than they were in 2008, but perhaps the numbers will not be as bad as originally predicted. Experts have forecast that repossessions could still increase as unemployment increases and interest rates rise. If you are worried about repossession, see this helpful information from Credit Action .
Here is a review of the other top money stories of the past week commencing 22 June 2009.
Wednesday 24thJune
Hull named young jobless capital – Research by the Centre for Cities research group has revealed that Hull has the highest proportion of young unemployed people in the UK, with 9.85% of people under-25 unemployed. Other cities hit hard include Sunderland, Barnsley, Huddersfield and Liverpool. At present 40% of the total number unemployed in the UK are between the ages of 16 and 24. The International Labour Organisation (ILO) has forecast that 2.94million people will be unemployed in the UK at the end of 2011, of which 1.18million would be below the age of 25. Despite the government introducing measures such as the Future Jobs Fund, experts fear that this will not be enough to address the young unemployment problem.
35,000 shops to go by the end of the year – Experian, a credit referencing company, has forecast that as many as 35,000 retail shops will close down by the end of December. With the retail sector accounting for one in nine jobs, these latest figures could indicate a significant increase in the number of unemployed in the retail sector by the end of the year.
Thursday 25th June
Benefits unclaimed during 2007/08 – The latest government figures highlight that £10.5bn worth of income -related benefits were not claimed during 2007/08. The figures released by the Department of Work and Pensions (DWP) indicated that three out of five income-related benefits had a fall in the number of people claiming them during 2007/08 compared to the previous year. If you are unsure whether you can claim any income-related benefits, visit www.direct.gov.uk for more information on who is eligible.
Credit card companies crackdown on interest rate 'tarts' – uSwitch.com published research that has indicated that credit card companies are beginning to crack down on customers who chop and change their credit cards to exploit the best deals. Cautious lenders have rejected 3.32million credit card applications in the last year; of which six in ten of these are individuals trying to transfer debt from existing credit cards. For many of these so called interest rate 'tarts', they will find themselves facing significant interest charges as many of their current deals come to an end.
Benefits unclaimed during 2007/08 – The latest government figures highlight that £10.5bn worth of income -related benefits were not claimed during 2007/08. The figures released by the Department of Work and Pensions (DWP) indicated that three out of five income-related benefits had a fall in the number of people claiming them during 2007/08 compared to the previous year. If you are unsure whether you can claim any income-related benefits, visit www.direct.gov.uk for more information on who is eligible.
Credit card companies crackdown on interest rate 'tarts' – uSwitch.com published research that has indicated that credit card companies are beginning to crack down on customers who chop and change their credit cards to exploit the best deals. Cautious lenders have rejected 3.32million credit card applications in the last year; of which six in ten of these are individuals trying to transfer debt from existing credit cards. For many of these so called interest rate 'tarts', they will find themselves facing significant interest charges as many of their current deals come to an end.
Friday 26th June
Cheque guarantee card to be phased out – Cheque guarantee cards are to be gradually phased out over the next two years as people switch to other payment methods when shopping. Of the 1,400 million cheque transactions in the UK last year, only 7% were used with a cheque guarantee card. Cheques will remain in use for other transactions such as business payments, however experts have forecast that cheques as a payment method have reached a point of 'irreversible decline' and will gradually be phased out of use altogether in the future.
FSA puts end to commission for IFAs – The Financial Services Authority (FSA) has outlined new regulations that will prevent Independent Financial Advisers (IFAs) from being able to receive commission from selling investments, pension and insurance products. These new regulations, which will come into force in 2012, are a concerted effort to put an end to the mis-selling of financial products which has become an increasingly large issue in the financial services industry. The new rules will require IFA's to tell their clients how much their financial advice will cost and give them the option of paying an up-front fee, or having the cost deducted from their investment. Financial advisers will also be required to obtain additional qualifications.
Cheque guarantee card to be phased out – Cheque guarantee cards are to be gradually phased out over the next two years as people switch to other payment methods when shopping. Of the 1,400 million cheque transactions in the UK last year, only 7% were used with a cheque guarantee card. Cheques will remain in use for other transactions such as business payments, however experts have forecast that cheques as a payment method have reached a point of 'irreversible decline' and will gradually be phased out of use altogether in the future.
FSA puts end to commission for IFAs – The Financial Services Authority (FSA) has outlined new regulations that will prevent Independent Financial Advisers (IFAs) from being able to receive commission from selling investments, pension and insurance products. These new regulations, which will come into force in 2012, are a concerted effort to put an end to the mis-selling of financial products which has become an increasingly large issue in the financial services industry. The new rules will require IFA's to tell their clients how much their financial advice will cost and give them the option of paying an up-front fee, or having the cost deducted from their investment. Financial advisers will also be required to obtain additional qualifications.
