A consortium of charities that help people with their debt problems have painted a rather grim picture of the bailiff practices and says reforms have failed to put an end to the problems faced by debtors.

It seems a dirty job keeps getting dirtier when it comes to bailiffs.

According to a consortium of charities including Step Change, Citizens Advice and the Money Advice Trust, bailiffs are still acting inappropriately despite reforms enacted in 2014.

The charities say the reforms have been ineffective when it comes to cleaning up the industry.

The consortium spoke to 1,400 people who had been dealing with debt collectors over the last six months and found that almost a quarter of them (24%) tried in vain to arrange payment over the phone.

The survey found that in too many cases where people made contact to offer payment, they were still visited by bailiff at their homes anyway.

The problem appears to be, in part, due to the current fee structure which gives them the incentive for them to do that, even though the rules say they shouldn’t.

Nearly a fifth (17%) said they were not contacted by the bailiff before they received the knock on the door, a breach of the regulations which came into force in 2014.

One in six clients in a survey conducted by StepChange had been visited by a bailiff in the previous year, half of those complained they had been treated unfairly, and 16% said they were forced to take out more credit to deal with the bailiffs’ demands.

It also found that intimidating behaviour was common during visits from bailiffs.

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Young people have become a growing target for identity fraud, which has reached record levels since they first began thirteen years ago.

The number of under-21s being defrauded last year increased from 1,343 in 2015 to 1,083 in 2016.

According to Cifas, the vast majority of identity fraud cases happen when the fraudster pretends to be an individual, buying products or taking out credit in their name.

Stealing personal information from letter boxes, hacking computers, obtaining data on the dark web and exploiting personal information on social media, fraudsters have all the necessary personal information they need to commit identity fraud.

Cifas advise that consumers shred any important documents when disposing of them, use strong passwords and have anti-virus software installed on their computers.

People are also being urged to limit the amount of personal information they give away on social media.

“With nine out of 10 identity frauds committed online and with all age groups at risk, we are urging everyone to make it more difficult for fraudsters to abuse their identity.

“We all remember to protect our possessions through locking our house or flat or car but we don’t take the same care to protect our most important asset – our identities.” – Mike Haley, Cifas deputy chief executive

How to protect yourself from identity fraud

• Keep the amount of information you give away on social media to a bare minimum. Your real friends and family know where you live and what date your birthday is
• Install anti-virus and anti-spy programmes on home computers. Around 80% of cyber threats can be removed by adding this type of software
• Use strong passwords using a mixture of capital letters, lowercase letters, numbers and symbols, ensuring your password is at least ten characters long
• Never use the same password twice and do not share the information with anyone else
• Don’t write passwords down or store them in your phone
• Shred all financial documents before disposing of them

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According to Aviva, a lack of knowledge when it comes to financial terminology is leaving UK adults confused and signing up to financial products without completely understanding what the product offers .

Two in five UK adults (41%) have ignored financial information given to them because they simply didn’t understand the terms used in them.

As a result, 45% of them say they have a poor understanding of the account or policy and how they work, rising to 52% in the South West.

Due to the lack of understanding in financial terminology, almost a third of UK adults (29%) have continued to use uncompetitive products longer than necessary – increasing to 37% in Scotland.

One in six have missed important changes to their policy as a result of ignoring important financial information, that figure rises to over a fifth (21%) for people in London.

Londoners are most likely to have lost money due to ignoring important financial communications from their providers (17% vs 13% UK average)

There are now so many more options open to customers when it comes to retirement planning that it’s vital they have the knowledge to make informed choices and pick the best path for them.

Having a poor understanding of how an account or policy works, or continuing to use uncompetitive products for longer than necessary can make a real difference when it comes to your income in retirement. As well as our new jargon buster on Alexa, Aviva has a whole host of valuable information on our website to help customers understand their pensions.

Of course, the financial services industry needs to ensure that information is communicated in a clear and consistent manner, avoiding unnecessary jargon wherever possible. The Association of British Insurers (ABI) has already carried out some positive work in this area by producing a guide to simplifying language for customers at retirement and we’re completely in support of these principles. – Alistair McQueen, Head of Savings and Retirement at Aviva

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March is one of the  busiest months for car insurance renewal and UK drivers are wasting an estimated £1.5bn a year by allowing their car insurance to automatically renew before checking they are getting a good deal according to new research by Go Compare.

5.25m motorists fell for insurers auto-renewal trap

5.25m motorists fall for the for the auto-renewal trap, allowing their insurer to renew their policy without checking to see if they could find the same cover for less  money with another provider.

Young drivers aged 18 – 24 who potentially have the most to save by changing providers had the least enthusiasm when it came to looking for a better deal, 41% out of loyalty to their current provider and 29% admitting a lack of insurance knowledge and confidence in switching .

Commenting on the research findings, Matt Oliver from Gocompare.com Car Insurance  said,

With the first number plate change of the year, March is one of the busiest months for new car sales and, as a consequence – car insurance quotes and renewals.  But, with car premiums hitting record highs, it’s now more important than ever to make sure you’re not getting a raw deal at renewal.

At renewal, insurers will offer to continue your cover – without you having to lift a finger.  But, what they’re not so good at telling you is that by shopping around you may be able to find the same cover for less.  Loyalty, when it comes to car insurance, generally doesn’t pay.  The best deals nearly always go to new customers.

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• Low income families have a meager £95 in savings, compared to £62,885 for high income families, savings gap now growing 25% annually
• UK families’ savings fall to their lowest levels in 18 months as typical income declines
• Homeownership among families falls to lowest level in four years (64%), low income worst off; 41% are homeowners compared to 90% of high income families
• High income families’ perceived property value now more than 2.5 times higher than that of low income families
• Over two in five families fear rising prices as inflation climbs and debt grows

The difference in financial outlooks between low and high income workers has grown vastly over the past year as inequality worsens.

Families also face increased financial pressure from stalling incomes and savings, added to rising debt and inflation fears.

The savings gap between low and high income families grew by a massive 25% year on year, from £50,072 in winter of 2015/16 to £62,790 in winter 2016/17.

Aviva’s data shows low income families (those earning £1,500 or less a month) now have a paltry £95 in savings and investments, down from £136 a year ago.

High income families (those earning £5,001 a month or more) have increased typical savings to £62,885.

Aviva’s data suggests that one in four families are now classed as low income workers.

The typical amount held in savings and investments across all UK families is at it’s lowest level since 2015 (£3,116), dropping from £4,426 last summer to £3,134.

Paul Brencher, Managing Director, Individual Protection, Aviva UK said:

The gulf between low and high income families is showing signs of widening, in a worrying indication that those less fortunate are finding their finances increasingly stretched. While high income families have been able to increase their savings pots, those with low incomes have seen theirs fall to less than £100. This reflects the trend of shrinking savings seen across UK families as a whole. Without a financial back-up, any sudden unexpected expense could put low income families in particular under added pressure.

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Unexpected boiler breakdowns have cost UK homes over £787 million in repairs over the last year, according to new data from uSwitch.

A fifth of those households – just short of 5 million – have experienced at least one boiler breakdown over the last twelve months.

Their research shows that the average cost of those boiler breakdowns was £270, adding to an estimated spend of around £787 million.

However, 250,000 households – 5% of those who experienced breakdowns – faced a cost of £1,250 for the repairs.

Of those without the necessary cover to protect themselves, 52% said they would have to dip into their savings to pay for the repairs, whilst 13% – 3.5 million homes – said they would have to resort to using their credit cards or taking out a bank loan.

Emma Bush, uSwitch.com energy expert, says:

It’s easy to take a working boiler for granted, but when things go wrong it can be expensive to fix – not to mention leaving you and your family shivering through a period with no central heating.

With consumers already facing energy price rises in the coming months, the sudden shock of having to repair a broken boiler – possibly costing over a thousand pounds – could deliver a tough blow to household finances.

To give yourself some peace of mind and protection against boiler bill shock there are different options available to suit every household. If you are concerned about your boiler and it is over six years old, boiler cover with an annual service could be a good option for extra peace of mind.

Some home insurance policies have boiler cover included so check yours to see if you are already covered and maybe consider a more comprehensive plan if you aren’t. If you do find yourself caught out with an unexpected and unbudgeted repair bill you can use a 0% purchase credit card or, for those times you do need to pay in cash, a 0% money transfer card – to give yourself some breathing room and spread the cost over a few months.

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Research from the organisation found that first-time buyers borrowed a total of £5.1 billion across 32,000 loans designated for home-owner house purchase in December 2017. This cash sum was up nine per cent on November, and 13 per cent on December 2015.

In addition, the average loan size granted to first-time buyers was found to have increased from £134,100 in November to £136,000 in December 2016.

It was noted that the increase in the size of loans from November to December 2016 could be related to the rise in the average household income of first-time buyers from one month to the next. In December, the average household income stood at £40,400, which was up on the previous month’s figure of £40,100.

Furthermore, in the fourth quarter of 2016, first-time buyers took out 90,800 loans, equating to £14.3 billion. This marked a one per cent decrease in both volume and value on quarter three. However, year-on-year, this showed a rise of four per cent in volume and seven per cent in value.

When it comes to home movers in the UK, the average amount borrowed increased from £170,900 in November 2016 to £175,000 in December. Meanwhile, the average home mover household income rose slightly from £54,800 to £55,000.

Lending in 2016

During 2016, home-owner remortgage activity rocket by 14 per cent in volume and 20 per cent in value when compared to 2015. This means the number of remortgage loans was at its highest since 2009.

Paul Smee, director general of the CML, said that 2016 had the potential to be a “destabilising” year of regulatory and political change, but had actually seen home-owner house purchase lending increase. He did note, however, that the buy-to-let sector’s positive lending performance had been primarily driven by remortgaging.

Looking to the future, he noted: “We do not expect the market volumes to show a year-on-year increase in 2017, instead [they should] remain similar to that achieved in 2016.”

By Amy White

The post CML: First-time buyer lending “healthy” appeared first on Latest UK Debt News & Personal Finance | ClearDebt Newsdesk.

Over a third of Brits (37 per cent) have multiple accounts, but half of these people only use one of them on a day-to-day basis, according to a survey of 2,099 people in December published by CompareTheMarket.com.

With 49 million people using current accounts in the UK, this means that around eight million accounts go unused. The average amount in these ‘zombie’ accounts is £141, which equates to £1.2 billion nationwide.

The research uncovered a lack of awareness surrounding interest rates. Over half of the survey sample (56 per cent) weren’t sure if their bank had cut interest rates in the past year, while 58 per cent didn’t know the interest rates on their current account.

When asked why they had more than one current account, nearly a third (31 per cent) of the survey sample opened another current account to take advantage of different rewards on offer, but a fifth of them admitted they had opened the neglected account some time ago and simply had not been bothered to close it.

Cyber security risks

The rise of online banking means that more than four in five now check their statements online.

However, 12 per cent of people surveyed with more than one current account said they check their unused account as little as twice a year, and with one in ten people falling victim to a cyber attack on their credit or debit card, that laxness could have serious implications.

Jody Coughlan, head of money at CompareTheMarket.com, said the number of ‘zombie’ accounts was concerning.

“Whilst it is a good idea to have a rainy day fund, the fact that so many people don’t regularly check their additional accounts is a risky move to take,” he commented.

He urged Brits to regularly check their personal finances for unusual activity and stressed how unused accounts are easy targets for hackers who might be able to steal away hundreds of pounds undetected.

Recurring direct debits from forgotten accounts can also cause customers to unknowingly go into their overdraft and incur hefty fines, Mr Coughlan concluded.

By Joe White

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