Economy Downturn

It doesn’t matter what angle you look from, at a distance it all looks the same. The U.K is in a deep recession and it is affecting everybody one way or another, homes are being repossessed and people are looking to quick property sale companies for help. Steve Martin our property expert will be giving his views on how the recession started and how long it will be before we get back to the good times.

Timing Why Now

Household Dept has been building up over the last 10 years it has now reached a level where consumers have a debt of approximately £1.4 trillion collectively, and people are being repossessed every day. 

What else do the policy holders have up their sleeve?

What are the authorities doing?

The Bank of England & the Chancellor Alistair Darling, believe and base their principles on people spending money (i.e. expenditure) someone else receiving money (i.e. income). With the consumers failing to do so, this has left a gap which needs to be filled in the private sector, because this will only produce more fear and have a negative effect on the economy, and there will be more redundancies and more people being repossessed.

Doorstep lenders overcharge whilst people try to stop repossession

It was revealed today that there are some doorstep lenders charging in excess of 500% apr on loans. Lender’s like Provident Financial, who is probably the largest doorstep lender, commented by saying it is “a fair and transparent lender”.

Barnardo’s, the children’s charity, have called for these doorstep lenders to be regulated in the hope that the extortionate interest rates can be a thing of the past.

Is the worst of the recession over?

There are a variety of articles being released commenting that the worst of the recession could be over, but the latest figures show the number of shops, retail outlets, public houses, etc, etc, closing is increasing, the number of people being made redundant is increasing and also the number of people trying to stop repossession is increasing. So is the worst of the recession actually over?

Repossessions are on the downturn consider sell and rent back!
 

It was announced that the number of repossessions were on the downturn but then it was also stated that the number of repossessions are also up to just over 24,000 so far this year. This is equivalent to 130-135 homes being repossessed a day. However this is still a 14% increase from last year!

Is the credit crunch over?

Some mortgage brokers are predicting that the mortgage lenders (banks/buildings societies) may start to lend money, this is due to the fact that the bank of England deciding to pump a further £50 billion into the economy.

The bank of England have said that this will make it easier for mortgage lenders to lend money because they are able to obtain the money at a lower cost to them, therefore being able to provide more mortgages.

Is this going to happen?

Chelsea Building Society announces fraudulent mortgages.

It was announced today that the Chelsea Building Society has been a victim of a huge number of fraudulent cases and has lost somewhere in the region of £41 million. The fraudulent cases have resulted in the building society remaining in the red with a recorded loss of £26 million overall loss in the half of this year, this is on top of a loss of £39 million last year.

Banks restricted on mortgages 

All the banks and buildings societies hands are tied when it come to new mortgages, hence why they are being so cautious/fussy on who they lend money to at the moment.