The number of potholes being reported to local authorities has risen five fold according to a new study. This works out at over £1 million of damage to cars each day. And in Scotland and some areas of Northern England where the situation is worst, as many as 1 in 7 are damaged.

It is thought that there are more than 3 million potholes in the UK’s road network causing damage to vehicles and severe danger to cyclists and motorcyclists alike.

An the cost of putting our roads right?

It’s estimated that there will be no change out of £100 million and at the current rate of repair, it will take 10 years to put right.

Damage to cars can be caused by one big hole but more often than not it’s the damage caused by driving continually over poor surfaces that causes the real damage. The average repair cost is estimated to be £240 although the bigger claims which are often covered by an insurance claim, can be as high as £2,700.

If want to join the campaign for better road repairs visit www.potholes.co.uk

It’s a fact that the law says that you must have an up to date Home Information pack before you put your home on the market. But it seems that half of house sales are going through without one!

So the law is being ignored or dodged.

And Local Authorities are doing little to enforce the law and the discredited paperwork. And discredited it certainly is as few if any purchasers care a damn about it and even fewer read them when they are available!

Apparently, long ago Local Authorities informed the Government that the regulations were unenforceable and it would cost too much to make it worthwhile pursuing sellers who did not have a HIP’s pack.

Even a report from the Trading Standards found that 5 out of 6 HIPs reports were misleading and not worth the paper they were written on.

Whilst the government has remained tight lipped about the future of HIPs the same cannot be said of the Conservative Party. Their housing spokesperson said that they will scrap HIPs packs saying, “We do not condone breaking the law. But rather than feebly attempt to enforce this bad law, the HIPs regulations should just be scrapped. Conservatives will scrap the packs.”

For the first time since the credit crunch struck, first time buyers can now get a mortgage with a 10% deposit. For some two years now, lenders have run scared of high loan-to-value mortgages as house prices fell away. But as prices begin to stabilise, lenders are re-entering the market.

Industry research shows that 21 lenders will now consider low deposit mortgages – although that’s a mere fraction of the number during the property boom years. (HSBC, NatWest, Yorkshire bank and Britannia seem the best)

Nevertheless it’s great news for first time buyers.

But as with all these things, there’s a sting in the tail. The cost of these low deposit loans is high. The average rate charged is close to 6.25% - that’s 5.75% over the Bank of England’s base rate for a 2 year fixed rate.

Before you dash out, consider what could happen when the fix comes off in two years time. Say you took one of these loans and base rate increased significantly during the next 2 years (as it most certainly will). Despite what optimists are saying we remain very worried about house prices and say we are right. What could happen in two years when the mortgage fix comes off?

Well, if the housing market remained down in the dumps you would probably have equity in your home of between 5% to 15%. At the lower end you’d be forced to stay with your lender and accept their standard variable rate. At the higher end you’d have enough to go mortgage shopping for a new fixed rate deal. But it’s touch and go.

Now add the scenario is that prices do continue to fall albeit at a slower pace, and you also need to move, say with your job. As you started with just 10% in your home you’d be lucky to clear that to put down as a deposit on your next home and that would mean that your next home would be rented. Your back to saving up again.

I know that some people will criticise me, but I think it is too soon to go for a 10% mortgage bearing in mind that interest rates are going to rise and the direction of the housing market is by no means clear. I’m not the only one that believes that the current upward movement in house sales and prices is a false dawn. The market still has lots of problems to face and lots to prove.

We are constantly hearing about the results of people’s identity being stolen – the fraudulent debts being taken out in their name, the scams on paypal and so on.

So what can you do to avoid being a victim of identity theft? Well you can never protect yourself 100% but here are some suggestions –

• Take yourself off as many mailing lists as possible – register with the Mail Preference Service (www.mpsonline.org.uk)
• Go ex directory. Contact your landline provider
• Whilst you will want to remain on the Electoral Role you can elect for your name to be taken off the published version. Speak to your local authority.
• Never volunteer any information about your date of birth or job especially to any organisation or web site that may publish that information – such as Facebook.
• When you have finished with any official mail or any mail which contains your date of birth, shred it.
• Many of us constantly receive emails purporting to be from banks, credit cards and other financial organisations. Unless you are expecting a specific email from your bank, delete them. Never reply when they ask you to “confirm any of your confidential banking details” or any personal information.
• Always open all of your mail, especially mail from phone companies, financial organisations or businesses selling electrical goods. It may be a letter about an application that they think you have made. If it does sound like that, phone up the company and check out why you received the letter.
• Always check your bank and savings account statements. If money has gone the quicker you get in touch with your bank, the better.
• If you post suddenly stops arriving contact your Post Office. Someone may have put a divert on your post.
• When you move home always divert your mail to your new address, it costs £39.05 for a year or £26 for 6 months
• If anything suspicious happens, check out your credit file at a major credit agency such as Equifax (www.equifax.co.uk)
• And finally, if you have had your identity stolen, confirm all your telephone conversations with the banks, etc by letter. With something as important as this, you need to leave a paper trail behind you in case disputes arise.

There’s a new ploy to exploit legal loopholes and get debt wiped off.

It’s a debt transfer scheme whereby the debtor pays a fee and transfers the debt to a claims firm through an agent. The debtor is then supposed to be debt free. The firm effectively gabbles that it will be able to get the debt cancelled.

The problem is that there are concerns that the debt transfer may not be legally watertight. If that is the case the debtor will have ended up paying a fee and still be saddled with the debt. Not very satisfactory if you are the debtor!

If you are in debt and are offered one of these schemes, take care. Look closely into the paperwork and get some form of guarantee that your creditors cannot still come back to you.

Better still don’t get into a financial mess and pay your debts!

Landlords financing their properties on buy-to-let mortgages are 3 times more likely to default on their mortgage payments than normal borrowers. This has led to a spate of repossessions.

Between January and March this year, 4,100 buy-to-let properties have been taken back by the lenders. 1,700 were repossessed and 2,400 were transferred to “receivers of rent” who then took over the running of the properties.

Few tenants would be aware that their landlords were in financial trouble, so often, the first sign of a problem is when the bailiff comes knocking and they discover that the property is about to be repossessed.

So now the Government is proposing to bring in laws to protect tenants. But an existing law helps them if they are part way through a tenancy agreement. It’s called the Law of property Act 1925. Under this legislation, the lender can appoint a receiver of rents to take the property from the borrower. These receivers are often insolvency practitioners or chartered surveyors and operate independently from the lender and the borrower. But it is up to the lender to decide whether to apply for repossession or appoint a receiver of rents.

If you are a tenant and are up to date with your rent, the law says that you have the right to remain in the property until the end of your tenancy agreement. If you are not up to date, then you have effectively broken the agreement and you can be evicted.

A problem sometimes arises when the lender is not aware that the borrower had rented their property out. In this situation, the tenancy agreement is not normally binding on the lender. The lender will consider the agreement as fraud on the borrower’s part and therefore the tenancy agreement becomes void. In those situations the lender can decide whether to opt for immediate repossession or go down the receiver of rents route. In today’s difficult property market some lenders prefer to keep the rental going and hold the property until the housing market improves.

If you are a tenant and know that your landlord is in financial trouble, you should consult your solicitor.

As you may know the Financial Services Authority allowed all the banks to suspend clients’ claims for excessive bank charges for two years. The argument is that the banks charges are excessive and in breach of unfair contract terms. This waiver was authorised by the FSA on 27th July 2007 and to begin with the waiver was just for twelve months whilst the banks and the Office of Fair Trading battled the case out in court.

But here we are two years later and the issue has still not been resolved.

Both the High Court and the Appeal Court have ruled in the favour of the clients but the banks are battling on to the House of Lords. Next week the House of Lords will start to hear the case but the outcome is unlikely to be announced for a number of months.

Let’s hope that things will be resolved in time for compensation to be paid out by Christmas!

This possibility is something that every family should have covered but it seems that more than 1.5 million families with children haven’t even considered the situation - and far more, 7 million, admit that they don’t have adequate life or critical illness cover.

This means that if the grim reaper came knocking, those families are likely to suffer severe financial hardship. In the worst case scenario the family might be unable to pay the mortgage and face repossession.

I know that the recession is putting strains on some family’s budgets but quite honestly, if you are under-insured you need to sort it out. At least get some life insurance which will payout in the event of death – the price of life cover is at an all time low so it’s a relative bargain. A 30 year old male, could get cover for £100,000 for 25 years for as little as £6.53 a month.

Even better, get some cover in case you become critically ill. Critical Illness policies cover the big three illnesses – cancer, stroke and heart attack – plus a wide range of other serious illnesses. These policies payout as soon as a diagnosis of an insured illness is confirmed. In many ways this type of cover is even more important that than life cover although you can buy both types of cover in a combined policy. Critical Illness cover is more expensive that pure life cover – because the chances of a payout are higher – which in many ways is confirmation of the importance of this type of cover.

So if you are one of the 1.5 million or indeed, one of the 7 million, for your family’s sake get it sorted!

We told you on the 8th June to get your mortgage fixed before rates went up. Well, if you haven’t yet taken our advice, you’d better hurry!

Nationwide set the trend last Friday when it withdrew its whole range of fixed rate mortgages and replaced them with rates 0.86% higher. We expect other lenders to follow suit with similar increases and the Yorkshire and Woolwich building societies have already withdrawn their lowest rates.

As we have repeatedly warned, the bank of England will be forced to raise interest rates sooner or later. Their base rate cannot remain at 0.5% for ever. The fears emerging about oil prices and the signs of house prices stirring will only serve to bring the increase closer. On top of that we are seeing the banking industry generally, staking steps to increase their margins.

So the message to borrowers is clear – get a fix now or you may be too late.

If your employer wants to fire you he now has to follow a new grievance procedure which amends the old “3 step” system.

If there is a disciplinary issue, the law now encourages employer to try to resolve the issue informally through discussion whilst carrying out prompt and thorough enquiries. It’s a softer start to a procedure which, it is hoped, will reduce confrontation and the escalation of difficult situations.

Only if the soft start fails or in very serious disciplinary situations does the previous 3 stage procedure kick in.’

The first stage of the formal procedure is for the employer to write to the employee detailing the disciplinary issue. The company must then arrange a formal meeting. Then the employee has the opportunity to appeal against the boss’s decision if the employee is unhappy with their decision.

It is hoped that the new start to the procedure will prove to be more flexible and will be able to resolve differences with a quiet word rather than always imposing the full process.

We agree. Sense prevails!

Figures from the Bank of England prove that Britains’ banks have been lifting their interest rate margins to unprecedented levels whilst restricting their lending.

Well actually, it shouldn’t have taken the Bank of England to prove what every family already knows. We have seen the average interest rate on our credit cards rise from 14.8% at the start of the year to 15.9% today. We’ve also seen the margin between bank rate and the average tracker mortgage rocket.

So banks are trading down whilst at the same time fattening up their margins. And throughout their investment portfolios, the banks are reducing their risk exposure. That package is a recipe for big profits at the banks – but it is very bad news for the British public.

There is little doubt that the supply of credit is going to remain tight and virtually non-existent for those of us with less than perfect credit histories. Try asking for an overdraft, a mortgage, a loan or a new credit card and watch your bank manager frown and suck his teeth.

And when the economy is confirmed as back in a growth trend, watch those interest rates rise! At the first opportunity the Bank of England will want to increase its base rate from the current lowest level ever of just 0.5%. Hands up who expects the high street banks to reduce their margins when that happens. Oh yes, you in the corner, what’s your name?

“Alice in Wonderland”

When you apply for car insurance, you have to disclose any motoring convictions you have. Is this fact or fiction?

We all know the answer – but, according to the Association of British Insurers, one in five applicants lie on their application in order to qualify for a cheaper premium.

As a result the car insurance industry is taking steps to gain access to the records at the DVLA to cross check every application. At the moment, insurers can only check a drivers’ conviction record when they make a claim.

In tough economic times, it seems that fraudulent claims are on the rise and priced within the average drivers’ premium is some £30 to £40 to cover the cost of fraud.

So if within the next year you make an application (or sign a confirmation of facts with your insurance renewal) and slipped in the small print you see that you have also given your approval for the insurer to obtain your driving record from the DVLA, watch out. You’d better make sure that the information you have provided is spot on.

If you get caught out, the best that can happen is that your premium will increase to its correct level, the worst is that your insurance will be voided and one more uninsured driver!

Figures from one of the largest mortgage lenders suggests that one in five of its borrowers are overpaying their mortgage. When the interest rate on their mortgage fell, they maintained their existing monthly repayment. If interest rates stay as they are (but they won’t – see yesterdays blog), then a 25 year repayment mortgage would end up being fully repaid after just 14 years.

A year ago a “life of loan” tracker mortgage of £150,000 cost £996 a month but today the payment has dropped to £600. If the borrower had continued to pay £996, instead of lasting another 24 years, the mortgage would be paid off in just 14 years.

That’s fine in theory but life isn’t quite as simple as that. Early repayment will only materialise if interest rates stay low. When interest rates rise, borrowers will have to increase their monthly repayments to achieve the same result. So not everyone will be able to knock years off their mortgage but it is still well worth keeping up over payments for as long as you can.

Just a few things to check out. Many mortgages allow over repayments but only up to a maximum of 10% a year. If you exceed that limit, those mortgages normally apply a penalty – so check that out. The other little trick that some lenders employ is that, when calculating the interest you owe, they don’t credit your overpayment straight away. That means that you are not saving quite as much as you should be doing. Not much you can do about it though!

Although the bank of England kept interest rates on hold last week at 0.5%, many experts are forecasting an increase before the year is out. When interest rates are so low, it doesn’t take a genius to forecast that the next move is up – but forecasting the timing of the increase is more tricky.

So what would an increase in mortgage rates mean to you? If you’re trying to sell your house, it’s not going to help is it? And if you’re happy where you are, have you fixed your interest rate?

In recent weeks many lenders have reduced their fixed rates and the number of deals under 4% have doubled. And with the best 2 year fixed rates sitting at less than 3%, now could be the time to get that fix.

To a certain extent, the interest rate situation will be conditioned by developments in the housing market. We feel that the recent mini upsurge we have seen has no legs as unemployment is still rising and mortgage lending is running at 60% down on last year. And if we are wrong, the Bank of England will see rising prices as time to bring forward the inevitable rate increase.

Therefore, with rates having edged down and with future rate increases on the horizon, anyone who moves their mortgage to a fix is making a shrewd move. If you can fix now for 5 years at less than 5%, that represents cheap borrowing – go to it!

The Financial Ombudsman Service (FOS) is now receiving three times as many complaints about debt collectors as in the last twelve months. The complaints are usually about relentless hounding and harassment.

But, say the FOS, when they get involved matters usually get resolved very quickly. As soon as the debt collector knows that the spotlight is on them, it remarkably focuses their mind.

So if you are being harasses for a debt that’s not yours and have done all in your power to explain that, here are some tips:

• Contact the company that employed the debt collector that you are being harassed. Under the guidelines laid down by the Office of Fair Trading, the business that employs the debt collector can be held responsible for its behaviour.
• If you are being harasses, phone the local office of the Trading Standards. And if you are threatened, contact the police straight away.
• You should not be contacted at unreasonable hours. So take a note of the times you’re called, what is said, and the language they use.
• It is illegal for them to ask you to call them back on premium rate phone numbers.
• If you have already settled the debt, the debt collector must check that out. They cannot make unjustified payment demands.
• And if, despite everything, the debt collector continues to hound you, write to the FOS.

Most teenagers look forward to owning their first car. Then comes the shock – not the cost of the car – but the cost of insuring it!

Take a 1995 1.0L VW Polo for example. Not exactly a boy racers delight but it has four wheels and it will get you around. The cost of insuring that car for a 17 year old student is around £2,370! That’s more than twice what the car is worth.

No wonder the UK is experiencing huge numbers of uninsured drivers. Young drivers simply cannot afford the cost and, as a result, choose to drive illegally. If they’re caught by the police, the fine will only be a hundred pounds or so and they’ll get time to pay. So why should they worry?

Some will take the twilight option of insuring the car with their parents as the main drivers and them as a named driver. That would be cheaper and get them insured – or would it? Actually, no they wouldn’t be insured if the insurance company found out about the cosy arrangement. That arrangement is called “fronting” and it’s fraud. If the insurer can prove fronting, the policy would be voided.

In addition, the parents and the teenager would go on a central register maintained by the insurance industry of people who have defrauded an insurer. If you thought it was difficult to get insurance – any insurance – then try now!

We are not proposing any solution to this problem, but somehow it needs to be solved. Unless it’s solved, properly insured young drivers are going to be a rare breed.

The mortgage industry has signalled the emergence of the “super prime” mortgage borrower.

At a recent launch of the 2020 Vision Study undertaken by the Building Societies Association, a speaker revealed that lenders are creating a “super prime” category of mortgage borrower who all lenders are now energetically competing for. These are borrowers who have more than 30% equity in their home and a spotless credit history.

The creation of this new category results from the lenders needing to have the highest quality mortgage book so that they can easily re-sell it to other financial institutions in order to finance their own increased lending.

These super primes tend to be older than the average new mortgage client and have professional qualifications. As such they also tend to be more financially aware and savvy. They are also high users of the internet!

So if this sounds like you, congratulations. You’ll have no problem getting a mortgage or re-mortgaging and you will be able to pick and choose amongst the best deals in the market.

Plans to give 6 months paid leave to new fathers have been put on hold. It seems that the Government has recognised the extra costs they would impose on business and decided now wasn’t the time, recession-wise.

Plans to extend maternity leave from 6 to 9 months have also bitten the dust, for the same reason.

Originally paternity leave was a keystone of the Labour Party’s manifesto at the last election. It’s implementation was expected to give families more flexibility in caring for new babies. But the Department for Business and Enterprise acknowledged that the proposals have become a casualty of cost cutting.

As expected, equality campaigners are agitated accusing the Government of undermining the equalities agenda.

The plans had been presented by labour as the keystone of its family friendly agenda and had won praise from female MP’s (including those who have been caught with their hands in the expenses till), family groups and equality campaigners. Yes, the plans would have allowed lesbians and gays to share maternity leave too!

As small business has pointed out, if a firm has 5 employees and one is on maternity leave, that’s a fifth of the work force out. The extra cost and hassle that it causes, particularly to small business, is enormous.

But of course, Westminster carries on its business in its usual way. The house of commons is to consider giving female MPs more maternity rights and even childcare vouchers to “encourage more women into politics”.

I wonder how they can fiddle the voucher system? Charge for children they’ve had adopted? Sell the vouchers for cash on Ebay ………

The answer is – check your bank balance! Because the next 12 months will be the more costly than any other 12 month period in your child’s life.

Clothes, living expenses, University fees and a car add up to as much as £18,302 a survey has revealed. When a teenager goes to Uni their cost of living soars – and parents are left holding the cost of an active social life and education. So this cost is made up of around £1,300 a month plus a second hand car costing £2,700.

This cost comes as a big financial shock as the first 17 years of the child’s life were relatively cheap. During earlier years the costs involved in raising them were effectively absorbed into the wider household budget – they ate the same food and lived in the same house. The only “extra” was the weekend spending money.

Then suddenly the child turns 18 and the parents are automatically expected to fork out thousands that they had not previously thought about. The biggest cost relates to Uni. Tuition fees average £328.45 a month only to be exceeded by the £527.33 it costs each month for their rent. Then there’s £59.50 for clothes and accessories, £78 for food, mobile phone £50.88, £120.75 on extra curricular activities such as gym and sports clubs, and £60.45 on electronic gadgets such as video and games consoles. Phew, what a list!

It is little surprise therefore that many 18 year olds are forced to start earning for themselves. Around two thirds of all 18 year olds get themselves a part time job even if they’re studying - bringing in an average of £167.45.