December 9th, 2022 | Andrew Hagger | News

Can you get a mortgage with poor or limited credit history?

Bad credit is a spectrum when it comes to mortgages, and there is some variation in the requirements among the major high-street lenders. For example, some lenders are prepared to consider less serious credit issues, such as default and CCJs when they are two to three years old and/or have been satisfied.

1. Mortgages for bad credit

• Some mortgage lenders specialise in providing loans for those with bad credit. They are also known as subprime lenders but they are not necessarily as accessible as traditional banks.

• A mortgage broker may know more about which lenders are likely to accept people with bad credit, so it’s often worth speaking to an adviser before applying for a mortgage.

• Taking out a mortgage with poor credit has disadvantages because you’ll normally pay a higher interest rate and/or might be offered a smaller loan amount. Before making a choice, it’s a good idea to compare the deals being offered to you now with those that might become available if you wait until your credit score has improved.

2. Guarantor mortgages

• Guarantor mortgages are another alternative for those who are fortunate enough to have a close friend or family who is willing to guarantee the mortgage for you.

• The person serving as your guarantor must be aware of all the risks and obligations they are accepting if you are unable to make repayments. Their home and yours may be repossessed if you are unable to make your payments.

• If you’ve been turned down for a mortgage because of poor credit, you didn’t meet the criteria for affordability due to a low salary, or you can’t afford to save the required amount for a deposit, a guarantor mortgage might provide you a way of getting on the property ladder.

Tips to improving your credit score before your apply

If you’re unable to find a suitable bad credit mortgage loan or guarantor mortgage, you should aim to improve your credit score. Find tips from our experts on how to improve your credit score below.

1. Verify that you are listed as a voter at your current address.

2. If you have any outstanding debts that you can afford to pay off, do so; otherwise, try to lower your overall borrowing so that it doesn’t exceed 50% of your total borrowing capacity. For instance, if your credit card has a £5,000 limit and a £1000 overdraft, you would want your balances to be under £2,500 and £500, respectively.

3. Any accounts that you are no longer using, including credit cards, store cards, and others, should be closed. This includes any accounts you have with people you are no longer associated with financially, such as those you may have shared a bank account with, like those with an ex-partner.

4. Authenticate the accuracy of all the data that has been recorded about you. Incorrect addresses and other information can be problematic, but there may also be errors in the information that the agencies have recorded as a negative mark. You can occasionally ask to have a note added to your file to explain a late payment if you can demonstrate that it was not your fault, for instance, because of postal strikes or a creditor-side accounting issue.

5. You can also apply for specific credit cards made to raise your credit score; these are especially useful if your score is low as a result of little credit usage in the past. However, to demonstrate that you can manage debt sensibly, you must borrow wisely and make all the repayments on time.

For further information, see our full guide here.

November 30th, 2022 | Andrew Hagger | News

Ben Dhesi, the creator of the energy-saving mobile app HUGO, built his career providing energy-saving software to businesses, racking up accolades such as two ‘Energy Buyer of the Year’ awards and the Energy Awards ‘Energy Technology Innovation of the Year’ – now he is using his expertise to help UK households with their winter energy bills.

From talking to your supplier to looking at hardship funds, Ben shares practical advice on what you should do if you find yourself struggling to pay your gas and electricity bills.

What should I do if I can’t pay my energy bills?

#1 – Don’t stop paying

While it’s true that a mass boycott of paying your energy bills would give the energy companies something to think about, it’s more likely to have had widespread negative ramifications.

A mass boycott could lead to a collapse in the market and the bankruptcy of energy suppliers leading to issues with energy supplies, even higher energy rates and more, so keep up with your payments as best you can – something is better than nothing.

TOP TIP – Your energy supplier is legally obliged by the energy regulator Ofgem to help you if you’re struggling, so try to work with your suppliers to find a better payment option such as setting up a direct debit or a payment break.

#2 – Work out your essential costs

The next thing to do is work out your essential gas and electricity costs. You can do this using looking at your energy usage on your smart meter or our HUGO app which breaks down your energy consumption by the hour.

Look at what it costs to run the essentials such as your fridge, heating etc. and see if there are any areas you can reduce your consumption, such as washing clothes in the evening when the energy rates are lower or limiting your use of energy-hungry devices like dishwashers.

TOP TIP – Take some time to see if there are small changes you can make to your consumption, as sometimes it’s the little things that add up! Items left on standby can cost you an extra £55 per year, and lights that are left on £20!

#3 – Talk to your supplier about your options

As I’ve already mentioned, your energy suppliers are legally obliged to help you if you’re struggling with your bills so don’t hesitate to get in touch with them ASAP. There are a range of options they could offer which are decided on a case-by-case basis depending on your circumstances. These include:

• A review of your payment plan
• A debt repayment plan
• Payment breaks or reductions
• Longer deadlines for bills
• Access to hardship funds
• Installing a prepayment meter

TOP TIP – Always be honest about your circumstances and ability to pay, there are different support options available depending on your situation such as if you are elderly, vulnerable or pregnant.

#4 – Check for any grants, schemes or benefits you may be entitled to

Even before the cost of living crisis, there have been grants, schemes and benefits available to help you with paying your energy bills, but more options have recently become available so it’s worth checking what you may be able to get.

Look into your energy supplier’s hardship funds – big energy firms will set up these charitable trusts to help those in debt to pay their bills. There will be eligibility requirements and each application is done on a case-by-case basis, but it’s worth seeing if your supplier has funds you can apply for.

The government also has many different schemes and grants you may be eligible for, so it’s worth taking the time to check your eligibility. These include:

• Fuel vouchers
• Cold Weather Payment
• Energy Bills Support Scheme
• Warm Home Discount Scheme

Some of these schemes will be paid to you automatically, and those such as the elderly, disabled, or on those means-tested benefits will have access to various extra one-off payments between £150 – £650. If you’re not sure what you’re entitled to I recommend speaking to your local council or Citizen’s Advice.

TOP TIP – If you can’t get a hardship fund from your own energy supplier, look into the British Gas Energy Trust. These grants are available to everyone, not just British Gas customers. 

November 28th, 2022 | Andrew Hagger | News

A staggering 91% of Brits have reported an increase in their living costs compared to a year ago, with 73% saying that costs have become more expensive in the last month alone – but benefits expert Paul Brennan explains that support is out there, if you know how to access it.

“If you find that figuring out which benefits you’re entitled to is difficult, it’s because they’ve been deliberately designed to be confusing. The government don’t want to give away money, so the onus is always on the claimant to know what they’re entitled to – and sometimes it’s much more than you think. We’ve seen a case where a pensioner couple had been underpaid £200 per week for years. Eventually they were back-paid a lump sum of £15,000”.

Which benefits am I entitled to?

There are actually more than 15 types of benefits that can be claimed in the UK, but some of the most common ones are:

1. Cost of Living Payment

The UK government announced that a £650 cost of living payment will be issued to households on means-tested benefits, including those receiving universal credit, income-based jobseekers allowance,income-related employment and support allowance, income support, working tax credit, child tax credit, and pension credit.

How to claim – if you’re eligible, you’ll be paid automatically in the same way you usually get your benefit or tax credits – usually in two lump sums of £326 and £324. If you believe you’re eligible and haven’t received a payment, contact the DWP.

2. Personal Independence Payment (PIP)

For people between 16 and the State Retirement Age with additional care needs. Your income is not considered when claiming for this benefit. You don’t need a serious physical disability to claim PIP – if any ailment means you need help with preparing food, bathing, using the toilet, dressing, moving, or planning a journey – you should consider applying for PIP. Even if you’re in employment, you could be entitled to payouts of up to £156 per week to help with your costs.

How to claim – before contacting the DWP, make sure you have: your contact details, date of birth, National Insurance number, bank or building society account number and sort code, your doctor or health worker’s name, address and telephone number, and dates and addresses for any time you’ve spent abroad, in a care home or hospital. The DWP will send you a form focusing on how your condition affects you – make sure you’re putting in as much detail as you can so that they have a crystal clear picture of your physical or mental health needs.

3. Attendance Allowance

For people who have reached State Pension age and are either physically or mentally disabled to the point where they require assistance or supervision with personal care needs or support to ensure they are safe. This benefit is available to people who live on their own or with others, and is not dependent on whether the assistance required is being given.

How to claim – ask a doctor or medical professional for form DS1500 – they’ll either fill it in and give the form to you or send it directly to the Department for Work and Pensions (DWP). You can also do this on behalf of someone else without their permission.

4. Disability Living Allowance (DLA)

For parents or guardians of children who have additional care or mobility needs due to an illness or disability. To be eligible for this benefit, the child would need to be under the age of 16 and there are other age rules for the mobility aspect of this benefit. DLA does not take any capital or income into account.

How to claim – print off and fill in the DLA claim form.

ABOUT BENEFIT ANSWERS

Benefit Answers offer a free question and answer service to UK residents experiencing difficulties with benefits. Their experts ensure that your benefits problems are dealt with professionalism and efficiency. No jargon, just accurate, straight-forward advice tailored to you and your circumstances.

www.BENEFITANSWERS.co.uk

November 22nd, 2022 | Andrew Hagger | News

Criminals are taking advantage of the cost-of-living crisis by advertising goods which don’t exist. Customers trying to reduce their energy expenditure could find themselves being specifically targeted, as revealed in NatWest’s 2022 list of predicted purchase scams criminals will use this Black Friday.

Air fryers are predicted to be one of the top new scams with consumers trying to get the best deals on the energy saving cooking appliance. Another emerging scam is personal heaters which are increasingly popular as consumers try to keep down soaring heating bills. The final item on NatWest’s predictions list of top scams to beware of are games consoles, such as PlayStations and Xboxes.

A purchase scam usually involves a criminal trying to sell goods online at a heavily reduced price. Another typical sign of a purchase scam is a time-based deal that adds pressure to the purchaser to buy now without thinking. The sites these scams are happening on most commonly are Facebook Marketplace, Instagram, Twitter and eBay.

The age demographic who are most likely to have their money stolen are 25-35 year-olds, very closely followed by 18–25 and 35-45 year olds. This is reflective of these age groups shopping more online and feeling more confident in the purchases they are making.

NatWest estimates around £10m will be stolen by fraudsters between Black Friday and Christmas through purchase scams and with the majority of scams under £1k each, according to data recently released by UK Finance, the scale of the problem and the number of people impacted will be significant.

Stuart Skinner, Fraud and Scams expert at NatWest said, “Black Friday is a great time of year to pick up a bargain but unfortunately it is also exploited by criminals. If you’re being sold something at a knock-down price from a private seller on social media or a website you’re not familiar with – don’t do it. Your goods won’t turn up and you’ll be left out of pocket. If it’s an unusually good bargain for an item you know is worth a lot more, chances are it’s a scam.”

NatWest and Take 5 advice on avoiding purchase scams this year

• Criminals spend hours researching you for their scams, hoping you’ll let your guard down for just a moment
• Be suspicious of any “too good to be true” offers or prices
• Be careful what website you are purchasing from – have you ever heard of it or seen it before?
• Use the secure payment method recommended by reputable online retailers and auction sites
• Where possible, use a credit card when making purchases over £100 and up to £30,000 as you receive protection under the Credit Consumer Act
• Don’t just go by a photo of an item – these can be easily faked
• Purchase items made by a major brand from the list of authorised sellers listed on their official website
• Be wary of clicking on links in unsolicited emails
• Always ensure you click ‘log out’ or ‘sign out’ of websites.
• STOP – Taking a moment to stop and think before parting with your money or information could keep you safe.
• CHALLENGE – Could it be fake? It’s ok to reject, refuse or ignore any requests. Only criminals will try to rush or panic you.
• PROTECT- Contact your bank immediately by dialling 159 if you think you’ve fallen for a scam and report it to Action Fraud.

More information on how to be scam aware this festive season is available from www.natwest.com or by clicking here  

November 15th, 2022 | Andrew Hagger | News

As parents struggle to make ends meet, kids’ nest eggs are taking a hit, with 12% of parents resorting to dipping into their children’s ‘piggybanks’ this year. With a tough year on the horizon 58% of families today have no savings account in place for their offsprings’ futures.

Independent research from Metro Bank has revealed that six in ten parents (59%) have had to stop putting money into their child’s account since August 2020, and 12% have already dipped into their children’s savings to pay bills.

The study of 2,000 adults from across the UK also highlighted that the four in ten (42%) who do have a savings account for their children are putting away £1,411 per year (a significant £117.50 a month).

One in four parents confirmed that their own savings are primarily in place for their children’s futures, with on average between £26 – £50 put away each month for that purpose alone. However, nearly a fifth (19%) say they will no longer be able to use their savings for this purpose.

Jo Bullard, Director of Bank Accounts Payments & Deposits, Metro Bank, comments:

“This year has been tricky to navigate, with rising costs affecting everyone. It is worrying that many families can’t afford extras let alone saving to build the traditional ‘nest egg’ for their children’s futures. Those savings may have traditionally helped with key moments growing up, including education and learning to drive. 

“It is important for children to learn about and understand finances. At Metro Bank, we believe that the earlier we can provide financial education, the earlier our younger generation will have the skills to navigate the world of money and help them understand how finances, saving and banking work. In addition to this, Metro Bank is here to help people who are struggling and offer a safe space to those who are anxious to talk about their money worries.”

The survey, conducted by OnePoll for Metro Bank, found that just one in five (17%) of us head to our bank for support. Out of those who asked their bank for guidance, over nine in ten (94%) said they found speaking to the bank helpful.

A study carried out by The University of Cambridge, found that, by the age of 7, most children are capable of grasping the value of money and understanding that financial decisions have implications and could cause problems down the line. The research also suggests children who are allowed to make age-appropriate financial decisions and experience spending or saving dilemmas can form positive “habits of the mind” when it comes to money.

November 9th, 2022 | Andrew Hagger | News

Analysis of the latest Bank of England figures from Freedom Finance, one of the UK’s leading digital lending marketplaces, shows that the average quoted household rates on personal loans are accelerating sharply.

Rates on both £5,000 and £10,000 personal loans registered the second largest monthly increase ever recorded and grew to their highest levels in recent years.

In the latest Bank of England Credit Conditions Survey for Q3 2022², lenders reported that the availability of unsecured credit to households slightly decreased in Q3 and was expected to decrease further in Q4.

Emma Steeley, CEO at Freedom Finance, said the sharp rise in personal loan rates demonstrated how the rising cost of borrowing was starting to feed into lender appetite and affect all forms of consumer credit.

“Borrowers have been battered this year by the rising cost of credit on secured and unsecured lending as interest rates have increased. Average mortgage rates have breached 6%, and this year credit card rates have surpassed levels not seen since the 1990s while overdraft rates are at their highest ever.

“This high-cost environment is now starting to roll into personal loans which surged this month. Personal loan rates are also a reflection of lender appetite, so this increase demonstrates the economic pain the UK is starting to suffer from.

 “Our message for consumers looking for personal loans remains that they must ensure they are taking all the measures available to them to get the best and most appropriate products for their circumstances.

“Digital marketplaces are a great way to shop around as they automate the process through just a single application and, because they use soft-search technology, consumers will only be offered loans or credit cards that they are more likely eligible for.

“As we’ve seen from the latest Credit Union data, record numbers of people in the UK are

November 1st, 2022 | Andrew Hagger | News

By James Mabey, Senior Associate at Winckworth Sherwood

Amid the current cost of living crisis and economic backdrop, it is understandable that many executors will decide to administer a deceased’s estate themselves and dispense with the cost of instructing a solicitor. We have compiled a list of 5 key reasons why it pays to pay for Probate.

1. Protection from financial risk:

Executors are accountable to beneficiaries and are liable personally for anything that goes wrong, and so administering an estate oneself, rather than instructing a solicitor, means taking on additional risk. This can be exacerbated by the fact that for many executors, it will be the first time they have carried out the role.  Unfamiliarity with the Court system, dealing with HM Revenue & Customs, HM Land Registry and generally with financial organisations can all mean that important deadlines are missed and financial penalties can result.  If something goes wrong and you have instructed a solicitor, you can complain to them and have the benefit of their indemnity insurance. . Instructing a solicitor to handle the estate can therefore give you peace of mind – not just that you are in safe hands, but also that you have an added layer of protection.

1. Relying on a solicitor’s expertise and access to resources

Instructing a solicitor who carries out this work on a daily basis and is familiar with the deadlines and organisations mentioned has a lot of advantages. A solicitor will have access to precedent letters and software specifically designed for completing and filing necessary documents, not to mention technical resources if there is a point of law or procedure which needs addressing, or the expertise within their firm to draw on. Unless you have access to these resources and software yourself, it is likely to take you longer than it would take a solicitor to complete the same work.

1. It saves you time

Administering an estate is a time-consuming process, with lots of the correspondence involved still needing to be carried out by letter. It is not uncommon for the administration to take one or even two years. More complicated estates can take even longer to administer. The amount of work required often comes as a surprise to an executor and the time involved can interfere with other work you might be carrying out, or simply eat into spare time. A solicitor can therefore help to free up evenings and weekends which you would otherwise spend on administering an estate.

1. It is a burden

If the person who has died is a family member or friend, you will be grieving at the same time as dealing with their estate, which is a double burden. As the months go by, beneficiaries can get restless and want to know when a property is going to be sold or when they are likely to receive their inheritance. Solicitors are familiar with the stages of an administration and timeframes and can manage expectations accordingly in their capacity as professionals.  The recent delays in applications for Probate have put an even greater strain on executors trying to manage expectations themselves.

1. And finally…The costs are more manageable than you might think

While solicitors’ fees for administering an estate may seem large, they often amount to between 1.5% and 3.5% plus VAT of the value of the gross estate. The fees are not payable by you personally and are payable out of the estate.

October 26th, 2022 | Andrew Hagger | News

A leading legal expert reveals what happens to a person’s debt when they die, including who is responsible for paying up and what happens if the money has run out.

There are a lot of misconceptions around debt and inheritance according to Solicitor Nicola Clayton of Atkins Dellow, who says it isn’t as simple as your debt dying with you.

Here Nicola reveals what happens to your debt when you die, and who might be held responsible

What happens to your debts when you die?

When someone dies their debts won’t automatically die with them but they also won’t be ‘inherited’ or passed on to their next of kin or family members – instead the payment of the debt will be paid out by their ‘estate’.

An estate consists of everything a person owns including their home, any other properties, investments, business interests, vehicles and belongings. These will then be sold with the funds going towards settling the debt.

Who has to pay off the debts?

While your debt won’t be passed on to your next of kin, the executor or administrator of your will is responsible for settling any outstanding debts you may have using money from your estate. This usually goes as follows:

1. First your executor will collect all of the estate’s assets, then arrange for the payment of any funeral or administration costs.
2. Next, the executor will settle any outstanding debts using the estate’s assets.
3. Once all debts have been settled the executor can finally distribute the remaining assets to any beneficiaries.

TOP TIP – To make it easier for the person who will be dealing with your estate when you have died, think about keeping a record of any debts which are held in your name and be aware that if debts exceed asset values this means your intended beneficiaries might not inherit anything from your estate.

What if there is no money in the estate?

If there isn’t enough money in the estate, the executor must ensure that the debts are paid off in prescribed order until the money or asset run out:

1. Secured debts e.g. banks or mortgage lenders
2. Priority debts e.g. HMRC or taxes
3. Unsecured debts e.g., credit cards or personal loans

Once the money or assets run out the remaining debts are likely to be written off and will not be passed on to a spouse, civil partner etc. unless they have provided a guarantee on a loan, or the debt is held in joint names.

What happens to mortgage debt?

If you have a mortgage just in your name this will be treated as secured debt and will need to be repaid by your estate as a priority.  If fully paid off the property can then pass to the entitled beneficiary, if not the property will be sold and the proceeds used to repay the mortgage.

However, a mortgage on a jointly owned property will usually mean the surviving borrower will be liable for the outstanding amount and will take responsibility for the mortgage.

If you jointly own a property as ‘tenants in common’ you can leave your share in the property to whoever you like and not necessarily the co-owner. In this case, if there isn’t enough money in the estate to repay the mortgage, the beneficiary can choose to take on the responsibility of paying the mortgage to avoid the need to sell the property.

TOP TIP – Always check the wording of any wills as sometimes they may state that the person inheriting the property is responsible for paying the mortgage as well as any other debts secured on the property. This means they’ll now be liable for mortgage repayments and can’t use funds from the estate to settle the amount.

What happens to joint accounts?

Joint accounts, such as those with a bank or building society, are not frozen after death and sole ownership is immediately passed on to the remaining account holder. This means they now own any money or assets in the account but are also responsible for any shared debts, such as a mortgage or overdraft.

For joint mortgages or loans, the outstanding debt will pass onto the other named party or parties but they will not be responsible for any other debts e.g. personal debts or taxes of the deceased.

TOP TIP – Check your insurance policies to see if any cover paying off the debt if the worst should happen – if not, speak to your creditor or lender and see if they can offer a new or alter your policy to provide some peace of mind.

Can Life Insurance be put towards your debts after you die?

Absolutely! Some people even take out life insurance specifically to cover debts when they die, being enough to cover the mortgage and other debts. Arranging life insurance can be a significant part of your estate planning to ensure that your family aren’t left with the burden of paying your debts out of the estate.

It’s very easy to get confused about what happens to your debts if you die; if you need guidance don’t hesitate to get in touch with a legal expert who can offer support, answer your questions and ease any worries you may have.

ABOUT ATKINS DELLOW LLP

Atkins Dellow’s highly experienced and personable team consistently delivers excellent, practical, legal advice, looking only after your best interests. They speak in plain English and focus on what’s needed to achieve the best possible outcome for you – looking after your personal and business matters wherever you’re based across the country.

www.ATKINSDELLOW.com

October 18th, 2022 | Andrew Hagger | News

Small businesses constitute a significant part of the economy, and credit cards are critical to their success. UK Finance head of research Adrian Buckle reports that there has been a long-running trend away from cash, with more consumers veering towards cashless options such as credit cards. In 2008, approximately 60% of payments were made in cash; by 2020, that figure was only 17%.

With the increasing pivot towards cashless payment, credit card processing is starting to become a backbone for small businesses across the country. However, a lot goes into getting the right equipment, setting it up, and managing it. If your business is new to credit card processing or you’re just looking to brush up on your knowledge, here are some tips you need to know:

1. Open a merchant account

A merchant account is an agreement between you and your bank that allows you to accept payments via credit card, debit card, or other electronic payment methods. To get started with credit card processing, you’ll need to open an account with a merchant bank or processor (also known as a merchant acquirer). Most businesses pay a monthly fee based on how much money they process through their account. Some banks will offer discounts if you agree to use only their services for other needs, such as loans, checking, or savings accounts for your business.

2. Find a suitable payment processor

If you accept credit cards as part of your payment processing, you’ll need an integrated point-of-sale system to process credit card payments. Finding a suitable payment processor requires looking into one that can provide a seamless card processing experience that fits your business. The kind of card payment machine you should get will depend on the type of services you provide. A restaurant, for instance, might find it more convenient to have a portable machine that can take card payments around the restaurant. On the other hand, a small grocery store may need a countertop machine to take payments at the till.

3. Have contingencies in case of fraud

Credit card fraud and scams do not only hurt consumers, but also small businesses. For instance, if a customer has a chargeback filed because of a fraudulent transaction, it may be difficult to recoup your losses. You should ensure you have a plan in place, so you aren’t left scrambling for cash when something like this happens. This can include having different payment processors or setting up direct deposit with the bank so that payments are automatically made when they come in. Consider setting up fraud alerts with your credit card processor so that any unusual charges get flagged immediately. These measures will help protect both sides from losses due to fraud.

4. Know the transaction fees

Not all credit card processors are created equal. Before deciding on a credit card processor, it’s essential to make sure you know all the transaction fees that are involved so you can account for them in your balance books. Some costs that your processor may charge include minimum monthly payments, surcharges for international transactions or business purchases, and transaction fees. For instance, your processor may charge you 5% or more if you process £10,000, or they may charge 1.5% per transaction. It’s crucial that you understand the fees associated with accepting credit cards and confirm you’re getting a good deal when you sign up for a service.

Credit card processing has become an essential part of small businesses. Setting up your credit card payment system with the right strategy doesn’t have to be complicated. These four tips are good starting points to consider before setting up a card processing system for your business.

October 13th, 2022 | Andrew Hagger | News

As details emerged this week that the average 2-year fixed rate mortgage is now 6.43%, Leeds Building Society has looked at historical data to calculate the equivalent mortgage rates.

Interest rates of 6.43% may seem lower than the mortgage rates of 15% which borrowers were paying in 1980 for example, but there is a critical difference: surging house prices, driven by a lack of supply and historically low interest rates since the financial crisis of 2008, and the commensurate increase in household indebtedness, mean that the 6.43% mortgage rates of today are equivalent to a rate of 25.7% in 1980 (see Editors’ notes for calculation).

In 1980, the average UK house price was around £21,000 and mortgage costs accounted for 11.3% of disposable income (see Editors’ notes). Today, with the average 2 year fixed rate mortgage on offer to new customers currently standing at 6.43%, those figures are around £292,000 and 45.1% respectively.

Housing is now at its least affordable point since records began.  The average home currently costs 9.1 times the average local wage compared to 3.5 in 1997 (Source ONS). This particularly impacts young people.  Rates of home ownership amongst 25-34 year olds have collapsed over the last 30 years.  In 1996, home ownership levels for this age bracket were 65%.  By 2016, the level for this age group had fallen to 27% – giving them the label of ‘generation rent’.

Leeds Building Society has confirmed the ways it will help aspiring and existing homeowners during the current period of market uncertainty but underlined the need for Government to act as well.

The Society has confirmed it will:

• Honour any mortgage offers (including the offered rate) to new customers for six months from the date of issue* (See editors’ notes).
• Give all existing customers who are up to date with their mortgage repayments and who are within three months of the end of their fixed rate deal a choice of other mortgages that they can transfer to.
• Not charge any arrears fees if borrowers fall behind on their mortgage repayments until at least 1 April 2023 – extending its suspension of these fees from since the start of the COVID-19 pandemic.
• Give tailored support to all members who are struggling, or may struggle, with repayments or are in arrears. Members should contact us as soon as possible so we can offer them the individual help and support they need. 

Richard Fearon, Chief Executive, Leeds Building Society, said:

“We stand firmly on the side of homeowners and first-time buyers and will do everything we can as a lender to help them. The recent, rapid interest rate rises following the mini-budget have been a hammer blow to borrowers and will continue to cause distress for them over the coming months.