The Conservative Party has said that it will abolish Home Information Packs at the start of a Conservative Government but sellers will still have to produce an Energy Performance Certificate (EPC) – that’s presumably because EPC’s are mandatory under an EU Directive.

We are yet to find out whether the EPC would have to be renewed every time a property is put on the market or whether it will be valid for a fixed period of time. What is clear is that the cost aspect of a EPC will be only a little less than the current cost of a HIP.

That’s because it’s the energy saving element of the HIPs that costs the most money to provide. But does the public have any confidence in the energy ratings? It seems that EPC assessments can come out with very different ratings depending on who surveys the property so it clearly is not a reliable assessment.

And in any case, when we’re off shopping for a new home do we really bring energy assessments into our selection criteria? Certainly not me!

But could there be another reason for EPC’s? I can just forsee some green politician suggesting that properties be subject to a new energy tax based on their EPC rating!

Over 100,000 people have attempted to get credit card debts and loans cleared off by using legal loopholes – but now a Judge’s decision seems to have closed the door for them.

The people owing the money have been trying to get their debts declared “unenforceable” because, for example, a credit agreement was worded incorrectly or could not be produced. But now a judge in the Commercial Court has ruled that even when an agreement is found to be “unenforceable”, this does not mean that a borrower was no longer liable for the debt.

Consequently, the borrower is not entitled to have their credit record wiped clean and the lenders still have the right to appoint debt collectors to recover payment.

A spokesperson for the lending industry said, “Some borrowers took out loans fully understanding what they were doing and properly borrowed the money. They have been trying to get the loans written off by using a technicality and that’s a cynical practice”.

We agree.

According to a recent report published by the Economic and Social Research Council, the recent rises in house prices are going to be reversed. As the government has to cut it’s expenditure, economic recovery will waver and house prices will fall again.

This in turn is expected to create a spiral as potential sellers take their house off the market and buyers find it harder to find what they want and, disillusioned, they too effectively leave the market. Then as household wealth falls, consumer spending falls and this again impacts on house prices.

The Council predicts that it could take three years for UK house prices to sustainably break out of this spiral.

If this is true, it is going to be three four, or even five, years before we see the mortgage lenders pluck up enough courage to accept low deposits as in a falling housing market. When markets fall, the equity homeowners have in their property can be eaten up very quickly leaving them in negative equity - and leaving the mortgage lender facing a potential loss on their lending. For the time being we are unlikely to see any lenders reduce their deposit requirements and this is not good news for first time buyers.

Let’s hope that the Economic and Social Research Council has got it wrong!

Last month a judgement slipped through the Newcastle County Court which could have major repercussions for the insurance industry.

The case related to a person who had been sold Payment Protection Insurance (PPI) by MBNA. The case was won on a technicality that will send shivers around the boardrooms of the companies that sold PPI.

The judge said that MBNA had created an “unfair relationship” by encouraging the client to take out PPI but failing to disclose the large commission that MBNA would earn as a result from the insurance company. Apparently, such an “unfair relationship” breaks new laws which were introduced in 2007.

As the judgement was delivered in a County Court, the case does not form a binding precedent but companies specialising in miss-selling compensation claims are rubbing their hands with glee. One claims company said, “This has massive ramifications. The unfair relationship issue is widely applicable as it underpins almost every sale of PPI”.

We think it probably applies to all other forms of insurance. Unless the seller informs the client of the commission they will earn, the case would seem to have been miss-sold.

The FSA plans to instruct banks to re-examine claims they have rejected for the miss-selling of payment protection insurance (PPI).

PPI was sold as a safety net to provide income to continue to repay loans and credit cards if the policyholder lost their job or became too sick to work or they had an accident. But these policies had restrictions. About 2 million people were excluded from claiming because they were self employed or part timers. Nevertheless the banks continued to sell the policies to people who had no possibility of making a valid claim. And it is not surprising that the banks were so keen on PPI – they made an estimated £1.4 billion a year from these insurances.

It now seems that the FSA believes that many of the compensation cases that have been rejected should not have been rejected. Consequently they are reported to be planning to instruct certain banks to review all the PPI claims they previously rejected. Apparently, this will affect around 40% of the companies that sold these policies and around 185,000 ex-policyholders.

The FSA have come to this decision because banks have been rejecting six out of ten miss-selling claims but when these rejections are referred to the Financial Ombudsman Service, nine out of ten are overturned in the customer’s favour.

So it seems that we can’t even rely on the banks to honestly review their own miss-selling without cheating!

Hey fellas, if your aged between 60 and 65 you need to have applied for your winter fuel allowance and it’s worth a cool £250! And for those aged 80 or over, the payment increases to £400.

The winter fuel allowance is paid automatically to anyone who receives a state pension but men between the ages of 60 and 65 aren’t eligible for state pension and, therefore, have to apply for the allowance separately.

Anyone aged over 60 by 27th September is eligible for the payment this year.
The Department for Work & Pensions is apparently concerned that some men are unaware that they are eligible for this allowance and have been advertising the availability of the payments. If you need to claim for this year’s payment, then get your claim in a.s.a.p. and in any event before 30th March 2010. Use the Winter Fuel Helpline on 0845 9151 515

Interest rates on personal loans are continuing to rise as lenders remain worried about borrowers keeping up with their repayments.

The rates from Marks & Spencer, Egg, and Tesco have all recently risen by 1.2%, 1% and 0.2% respectively. Twelve months ago, the typical interest on a three year loan for £5,000 loan was 11.2% whereas today it is 12.2%.

Rates have risen because lenders think that the outlook for defaults continues to worsen. As a result the anticipated losses have to be covered by the majority of customers who do fulfil their obligations. This tends to indicate that the banks are supporting those economists who foresee a worsening unemployment rate. Now that the government is clearly planning savage cuts in expenditure the fuller, longer term affect of the credit crunch it is coming home.

We have to advise that despite the recent signs of recovery, the best advice remains batten down the hatches.

We think that motorist and the motor insurers will have something to say about the latest advice given to the government. The advice is that motorists should always be legally liable for all accidents with cyclists – even if the motorist was not at fault!

The advisers are called Cycling England an organisation funded by the Transport Department and they want the civil law to be altered so that insurers would always be liable for compensation. Now hands up who thinks that advice comes from an impartial assessment from a neutral adviser?

I can’t see any hands! Let’s try again, who thinks that advice comes from an impartial assessment from a neutral adviser?

Thank goodness you’re all sitting on your hands, because the proposal seems absolutely daft to me!

Apparently, the proposal has been based on regulations in Denmark, the Netherlands and Germany whose laws are heavily skewed in favour of the cyclist. Now I am less concerned about laws “skewed in favour of cyclists” than I am by the proposal lying on our government’s desk which advises that motorists should always be liable for an accident with a cyclist. To me the UK proposal goes two steps too far.

Let’s face it, why should a motorist have to pick up the tab if a cyclist is involved in an accident whilst riding the wrong way up a one way street? And what happens when the cyclist jumps the traffic lights or even goes through the lights when they are against them. These things do happen – I’ve seen it many times, especially in central London.

Motorists unite. Insurers unite. Defeat this daft proposal.

Our tip for today is pay this months’ credit card and utility bills either online, by phone, at the post office or at you bank. Why? Because the regional postal strikes are extensively delaying postal deliveries and it’s set to become much worse.

If you usually pay your bills by post, there’s a strong possibility that your payment will arrive late. That means that your credit cards will charge you a late payment fee and that late payment will find its way onto your credit rating. So you face a two way hit.

Local postal strikes have been happening since June but a national strike is now on the cards after the Communication Workers Union balloted its members on strike action over conditions and pay.

According to a recent survey 1 in 8 homeowners expect their house to fall in value during the next 12 months. This is despite 5 months of upbeat market reports from mortgage lenders and even the land Registry.

Confidence is lowest in the Midlands and Wales but even in more affluent London just over 50% think prices will rise with 31% expecting them to stagnate.

The latest Hometrack survey which is conducted amongst 6,000 estate agents and surveyors suggests that price increases were restricted to just 11% of the country – primarily in the south east. Across the rest of the UK, prices remained level.

The constant talk in the press about “green shoots” appears to be centred in the south east and amongst those in whose self interest is served by price rises. Hello Mr estate agent!

The awful customer service provided by the banks has been exposed, yet again, by the Financial Ombudsman Service. Their recent report shows that the banks not only receive more complaints than other financial organisations, but they have become surprisingly awful at dealing with them.

Historically the Ombudsman has upheld at least 33% of consumer complaints – but now it’s risen to at least 66% and sometimes as high as 95%. This tells the banks something they really must listen to.

Mis-sold payment protection insurance which was sold alongside loans and credit cards, head the list of problem areas. However, this must come as no surprise to the banks who merrily continued mis-selling the insurance for years - and now the birds have come home to roost.

If the banks’ complaints departments had been doing their jobs properly, many of the complaints seen by the Ombudsman would never have surfaced in public. As it happens, the banks appear to have decided to tough the situation out and obstruct legitimate complaints, probably in the hope that most of the complainants would get tired and simply give up.

The truth is that if the banks dealt with complaints properly the Ombudsman would never have got involved and now the banks are on the rack. It is difficult to avoid drawing the conclusion that some service and complaints departments at the banks are following a policy of confusion, delaying tactics and simply obstructing off those who complain.

If this is the case, they deserve every bit of bad press they receive and the FSA must levy huge non- compliance fines on them.

Lloyds TSB clients face charges of up to £200 a month if their current account goes into an unauthorised overdraft but if users of the banks’ Islamic account goes overdrawn, only £15 is charged. This has led the bank open to accusations of religious discrimination.

The Islamic account attracts Muslim clients to the bank by allowing them to bank in accordance with their faith. Sharia law does not allow interest to be paid so these accounts do not have a overdraft facility. So if a payment is made and the account has insufficient funds, the payment is blocked and a “returned payment charge” is levied. But on some accounts there is an arrangement whereby such payments are authorised and a £15 “unplanned overdraft fee” is charged. The bank says that the £15 payment is a fee, not interest and as such is in accordance with Sharia law.

However, standard current account users who go unauthorised into the red by over £100 are hit with fees of £20 per day for up to tens. This means charges of up to £200!

One commentator said, “It strikes me that this is bordering on the illegal. One cannot help thinking that the bank is bending over backwards to assist Muslims to the detriment of everyone else”.

What do you think?

The Institute for Public Policy Research, the Labour Party’s think tank, has recommended that middle class students should be denied student loans to fund the cost of living whilst at University and tuition fees.

If this were to happen, their parents would be forced to shoulder more of the cost – £3,225 for tuition alone possibly rising to £7,000 if Universities succeed in their lobbying for higher fees plus living expenses. Denying middle class student the opportunity of part funding their University education through a student loan would place untold pressures on the middle classes.

These proposals from the Institute for Public Policy Research are in effect a massive stealth tax on families whose aim is to ensure their children are fully educated for the 21st century. The Governments reaction has been luke warm to the report but they have refused to dismiss its conclusions saying that the Government is committed to making sure that money is not a barrier to people going to University whatever their background.” Few could argue with that sentiment but as usual, the devil will be in the detail – when and if it appears!

The Financial Services Authority has announced that it would take enforcement action against building societies, large banks and broker dealers who fail to follow its new remuneration code which is due to come into effect in January 2010.

Following its concerns that the current bonus regime contributed to excessive risk taking in the banking sector, the FSA wants pay and bonuses to be more closely linked to the profitability of financial institutions. The new code makes clear that financial institutions should not enter into contracts with employees which provide guaranteed bonuses for more than a year. The FSA also wants two-thirds of bonus value paid to senior employees, to be spread over three years.

The businesses will have to send a statement of their remuneration policy to the FSA by the end of October. This will have to be approved by the businesses’ remuneration committees and will provide the basis on which the FSA can check compliance with the code.

The FSA has said that non-compliant business will face enforcement action or be forced to hold additional capital resources if they follow risky business policies.

This new code should achieve two objectives. Firstly, Directors must ensure that the total value of bonuses distributed to employees is consistent with good risk management and sustainability. Secondly, individual compensation schemes must provide the appropriate incentives.

To action their new policies, the FSA has added eight principles to their rule book. These are designed to ensure that all financial institutions fully understand how the FSA will assess their compliance.

These eight new principles are consistent with the recommendations of the Financial Stability Board and with the measures being considered by other countries in the EU and Switzerland.

Sale and lease back arrangements are where the homeowner sells their house to a third party at a knock down price and then rents it back. It’s been one of the options people have had when they are in financial difficulties but are desperate to remain living in their house.

One of the problems has been that some unscrupulous landlords have thrown their tenants out after the first year and then gone on to sell the property at a healthy profit. The Financial Service Authority which now regulates these deals has already said that such actions are unfair.

Last week the Birmingham County Court backed up the FSA’s view. The Court said that a couple from Shropshire could remain in their house even though the company they had sold it to had stopped paying the mortgage. In fact the judge said that they could remain in the house for life by either renting from the mortgage company that had repossessed the house or buy it back.

Whilst this shows the way the English courts are thinking, the judgement in Birmingham doesn’t represent a legal precedent. Precedents can only be made in the High Court.

So if you are court in a similar position, before you take ant action, talk to the experts at the Citizens Advice Bureau to see whether they agree that you have been treated unfairly.

The fine for not wearing a seat belt is doubling to £60. The Department of Transport says that this is not about money and is all about saving lives.

According to official statistics, around 565 people killed each year in car accidents were not wearing their seatbelt and of these more than 300 would have been saved if they’d been belted in.

Last year some 235,000 fixed penalty notices were given out because the vehicle occupants were not wearing their seat belts - and a further 4,000 cases were heard in court.

In our view is it simply daft to not wear a seat belt. No matter what “non-users” say, they don’t restrict your ability to drive the car and what restrictions they do impose are surely small beer compared to the pain and suffering they undoubtedly save.

If you don’t believe me ask the doctors who end up piecing together the accident victims whose injuries are twice as serious because they weren’t belted in.

Or ask the families of the 300 people who would be with their families now if they had only worn their seat belt.

To re-coin an old phrase – “clunk click every trip”.

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.

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”

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!