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Household insurance

chris — Tue, 20 Dec 2011 13:16:58 +0000

When buying your first home, insurance can be one of the confusing issues. To help this, we’ve just published a new article on household insurance to help you get to grips with it:

“Making that first step onto the property ladder is a difficult process. First of all you have to save as much as you can for that all-important deposit, which is easier said than done. That?s not the end of it though, there are plenty of smaller things to do that you might not have even considered. Insurance is one of these things and it?s something that first time buyers probably haven?t even considered.”

Household Insurance: the differences between household and content insurance

Key things to consider when buying a new home

chris — Mon, 19 Dec 2011 13:13:23 +0000

If you are planning on buying a new home soon, take a look at the article we have just published on ‘Key things to consider when buying a new home‘:

“Buying a new home is one of the biggest financial commitments anybody can make, and it pays to do your research early on and figure out the costs involved at every stage. One of the first things to think about is your deposit ? if you?re a first-time buyer, this is likely to be up to 20 per cent of the value of your house, which can take years to save up for depending on where you live.” read more…

Base rate stays at 0.5%

chris — Thu, 08 Sep 2011 12:43:15 +0000

The Bank of England has today voted to keep the base rate at 0.5% – the rate it has been at since March 2009. The continuing low rate has allowed mortgage holders to save £51bn. One can only hope the length of time this low rate has lasted hasn’t lulled many into a false sense of security – with people getting complacent about taking out large mortgages due to the low rates.

Base rate stays at 0.5% again

chris — Thu, 07 Jul 2011 12:45:55 +0000

The Bank of England has again decided to keep its base rate at 0.5% following today’s meeting. Even though inflation is over double the target of 2%, the lack of movement was widely expected since the economy is still only growing very slowly. It is expected that the first increase will not be until 2012.

The base rate has been at 0.5% since March 2009 when it was dropped by 1%.

Ben Thompson, managing director of Legal & General Mortgage Club, says: ?Our view remains that rates will stay unchanged for the remainder of this year and in all likelihood won?t rise much anytime soon, as we expect inflation to fall back sharply next year, albeit remaining a little above the Bank?s 2% target.

The news probably makes little difference to many house owners and potential buyers since mortgages are still hard to obtain, and interest rates still signifcantly higher than the base rate.

Ewan Edwards, head of retail products at Norwich & Peterborough, reminds consumers that ?while keeping the rate so low is helpful to borrowers, they should be mindful that there is likely to be a rise over the next six to twelve months, so this simply gives them a little more breathing space to review their mortgage and maybe consider finding a good fixed rate deal.?

Home insurance or Tenants? insurance?

chris — Thu, 30 Jun 2011 12:51:27 +0000

With mortgages still difficult to obtain, especially for first-time buyers, many of you will be considering renting until mortgages are more obtainable. A factor to consider when choosing between buying and renting is insurance – we’ve just posted a new article on insurance. Here is an extract:

“Making a decision between buying a home and renting a property often comes down to your budget and whether you can afford mortgage payments or rent. However, one factor that should not be overlooked when assessing what you can afford is home insurance, which differs widely depending on whether you?re buying or renting…”

Click here to read the full article.

First time buyers

chris — Wed, 01 Jun 2011 01:46:06 +0000

With first time buyers finding it harder than ever to get on to the property market, we thought it was about time that we posted a little info specifically to help first time buyers.

“When you?re in the process of buying a home, it can become pretty stressful. You want to make sure that you?re making the right investment and that you?re investing your saved money in the best option. If you?re a first time buyer, circumstances become all the more exciting and gripping. In fact, many people who still don?t have a property often feel they need one right away. They feel that if they don?t step on the property ladder soon, it will become too late. If that sounds like you, don?t worry. By being aware of the…”

If your are a first time buyer, then make sure you read the full article.

Base rate stays at 0.5% for 2years

chris — Thu, 10 Mar 2011 14:39:09 +0000

The Bank of England has recently voted to keep the base rate at 0.5% – despite the fact that inflation is currently at double the target rate. This brings the 0.5% run to 2 years, although last month’s votes (three members voted to increase the rate) lead many commentators to predict that this month might be the month of the first rise.

Although the low rate is good for mortgage holders, it does mean that inflation is quite high. Mortgage rates are also still high compared to the base rate, with fixed rates under 5% only available to those with a sizeable deposit available.

Home Insurance

chris — Mon, 31 Jan 2011 13:56:05 +0000

Do you have an excess on your home insurance premium? If so, you could in fact be losing money, according to new research done by moneysupermarket.com.

The moneysupermarket.com home insurance team recently took on a piece of research in order to find out whether taking an increased excess payment on your home insurance policy it actually cost effective ? and the results may surprise you?

The sample property used was a 3 bed semi detached property, built in Manchester?s M20 postcode. The house was valued at a £380,000 rebuild value, a £210,000 rebuild cost, and also included £40,000 of contents insurance. The cheapest ten results for a number of different excess amounts were then noted, and some of the results found will be analysed below.

So let?s start at the start, with no excess at all. If you were to have no additional excess to pay, the cheapest premium offered for the property was £140.98 whilst the most expensive quote was £524.70. This is a little incongruous however, as £524.70 was almost double the price of the next most expensive quote. The average quote came out at £251.48 however, which means that we now have a number to compare results to.

So what happens when you start increasing excess amounts then? Well, if you think that premiums go down, you might well be surprised.

As you can probably see, the more excess you add to your policy, the more likely you actually are to pay more for your policy ? in fact, you?d need to put a £500 excess on your policy before it starts to drop again ? and you probably won?t get it as cheap as you could without any excess anyway?

It?s also worth noticing that the cheapest quote only varies by around £6, and a £200 excess actually returned the cheapest quote altogether, every amount of excess higher than that returning a more expensive quote.

What is most surprising however is that a £400 excess is such a phenomenally bad deal: Not only are you losing money in terms of policy payments, you are also taking an enormous risk for no reason.

And as previously mentioned, the old maxim of increasing your excess to decrease your premium is no longer true: Even the cheapest quote with a £500 excess was still a pound or so more expensive than our cheapest quote at £200 excess, and the rest being far more expensive than their lower excess counterparts.

The numbers and the graphs speak for themselves: Premiums tend to be cheapest with an excess of £200-£300, so it?s worth getting a few quotes at around this range. What is possibly the most interesting thing is how little those cheapest quotes varied: just six pounds difference between no excess whatsoever and £500 of voluntary excess.

Mortgages figures low for 2010

chris — Fri, 21 Jan 2011 14:29:51 +0000

New figures from the Council of Mortgage Lenders show that mortgage lending in 2010 came to just £136.3 billion – down 5% on 2009. This is the lowest figure since the year 2000. This news won’t come as a surprise for those who attempted to obtain a mortgage in 2010, with many applicants reporting it to be particularly difficult to secure a reasonable mortgage – especially first-time buyers.

The CML also state that they expect the Bank of England base rate to rise sooner than previously thought due to the recent figures for inflation showing the figure rising from 3.3% to 3.7%. However the CML don’t believe the base rate will go above 1% before the end of 2011, nor 2% before the end of 2012.

Base rate stays at 0.5%.. again!

chris — Thu, 09 Dec 2010 13:39:41 +0000

The nine members of the Bank of England’s Monetary Policy Committee, which decides the base rate, have made their votes for December, and the rate will be kept at 0.5% for the 21st month in a row! Recent voting results would point to the rate staying at 0.5% for the foreseeable future since only 1 member voted for a rise in the rate.

As always though, despite the low base rate, mortgage rates are still several percentage points higher, and mortgages are still relatively difficult to obtain – even for those with a spotless credit rating.