Finance Talk

Earlier this month the Bank of England decided to try and aid the failing economy and boost household finances by cutting the base rate for the third time since December, taking the rate down from 5.25% to 5%. It was hoped that this move would help to ease financial strain for households, would restore some level of consumer confidence, and would have a positive knock on effect on the economy.Following the rate cut the Prime Minister, Gordon Brown, asked that all banks do their bit for the economy and pass on the full rate cut to borrowers, particularly given the billions of pounds that the government had ploughed into the money markets recently in order to try and increase liquidity for lenders. However, whilst some banks have already agreed to pass on the full rate cut to borrowers there are also those that have ignored the PM’s pleas, and have hiked up their mortgage loans rates despite the rate cut.The latest to go against the calls of Gordon Brown is the Halifax, which has recently announced that its two year fixed rate and tracker mortgage rates are going up by an average 0.35%, and that some shorter term deals could go up by up to 0.5%. The Halifax recently hiked up rates on mortgages for those with only a 5% or 10% deposit. Longer term fixed rate deals remain unchanged, and Halifax officials have said that it makes more sense for consumers to opt for a longer term deal.An official from Halifax said: “The pricing for the two-year fixed and tracker mortgages has increased significantly in recent weeks across the industry because of the cost of funding in the money markets. The difference between base rates and Libor is 0.9%, the highest gap for many months.”

Debt consolidation is a relatively new buzzword of today’s society. Putting all your problems in one bucket, so to speak, enables many people to get their finances in order. The average person tends to have more than one credit card and many also have store cards and other forms of credit systems in place. This is usually when things can go wrong. It is harder to keep track of the overall situation and before very long large debts have been run up. This trend is on the increase despite all the advice that is around today and the high interest rates some companies charge.

Bankruptcy is a word that used to send people into nightmares and had a stigma attached to it, like a branding iron had been used on the forehead. Whether it is a sign of the times or not the term does not carry the same aura about it any more. Consolidation of debts and Independent voluntary arrangements are more the buzz words of the modern era. These arrangements have enabled many people that were facing insolvency a way out of a crisis. For those in a like situation, surfing the internet for a qualified company that has the experience in dealing with such matters is the best option open to them

Many people who have invested in rental property can now live off the revenue without having to keep a full time job in the process. Such is the tremendous of power of borrowing monies and investing them to in the right type of property. If you are investing in property abroad, you should research the best banks to deal with, and some tend to specialise in this subject. If you are borrowing from your local bank, you should ensure you take into account the current status of the exchange rate and recent trends. It may be wise to hold back on changing large amounts of money until you feel confident you are changing at the right time.

Making personal financial decisions is a risky business. It comes down to personal preference, in most cases, as to whether an individual wants to remain cash fluid or run up high debts and loans. There are counter arguments to whether the former of latter are the best course. With financial factors being somewhat stable in recent times, the cash to loan ratio has taken a downward swing. Balancing long term assets, stocks debts and savings is one hell of a juggling act and there is not one cast iron way of making sure you are doing the right thing, so it pays to think before you act.