Make sure you can pay back before you spend

Trying to remain positive in a reasonably bleak market is tough at the best of times. However, not only are the national press hinting that rates are to increase, but the Bank of England are also getting in on the act!! This week, in it’s Financial Stability Report, the Bank has said wholesale funding (loans between lenders) will rise, resulting in higher mortgage rates. The report claims that the gap between funding costs and pricing has grown, making lending less profitable. It will be interesting to review that point once the end of year lender profit announcements have been released! That said, Matthew Wyles, Group Distribution Director of Nationwide has also suggested that mortgage rates would probably need to rise next year! These are very big names making these comments and we cannot afford to ignore them.

HSBC have been in the news this week as the FSA have fined them £10.5m for alleged inappropriate investment advice to elderly customers, via one of their subsidiary companies. The HSBC commercial division is also undergoing a restructure with the loss of around 330 jobs.

Good news for the Buy to Let market as Abbey for Intermediaries (part of Santander) are shortly to offer products in this arena. With few big players in this market, we welcome this giant who will shake up the competition, as in the main, the associated costs with a Buy to Let mortgage have become pretty expensive of late. We await to see their products and offerings, but anticipate these to be launched before the end of the year.

Finally, it’s just round the corner and will be on us all before we know it. Christmas is a time for
joy, cheer, laughter, happiness and credit… Not that I want to preach, but credit is your life history to a financial institution. I’m not saying don’t use credit, but make sure you can pay it back! If you miss a payment over the Christmas period on any debt, it could affect your ability to
obtain any type of credit next year. Credit reports may show the last six, yes SIX years of your financial history.