25 October 2008

Affordability is Key

The effect of NINJA mortgages (no income, no job or assets) in the United States is widely credited to be the source of the current credit crunch. In the UK, the Financial Services Authority (FSA) stated when it was originated that affordability is the key to any lending that they formed a number of regulations to prevent excessive lending and the practice of granting mortgages to people who could not afford it.

There are a number of acts to regulate mortgage advice and prevent this type of mi-selling and they are listed below:

The Financial Services and Markets Act (2000) creating the FSA.

The Regulated Activities (Amendment) Order 2003 SI 1475, by which the Treasury gave responsibility for regulated mortgage lending and related activities to the FSA from 2004.

FSA rules requiring lenders to take account of a "customer's ability to repay" (Mortgage Conduct of Business (MCOB) 11.3.1 R) as well as maintaining a "responsible lending policy" (MCOB 11.3.4 R).

The FSA rules cover the whole mortgage selling process and states that consumers should be advised on suitability. In assessing whether a mortgage is suitable, the affordability of that mortgage is the key criteria.

The Demise of Payment Protection Insurance

Going back only a few years, most of the financial press and operators in the financial market warned Financial Advisers and Mortgage Brokers that they were not selling enough Payment Protection Insurance (PPI) and that this is could result in their clients not having adequate protection and leaving them exposed. I have recently come across a number of articles in the financial press that I believe are considerably misleading and in somewhat degrading a very important insurance cover which could protect people from losing their homes, that is mortgage payment protection insurance (MPPI).

Okay, it is true that the Office of Fair Trading (OFT) , the Financial Services Authority (FSA) and the Consumers Association continues to highlight and find failings in the sale of loan and credit card PPI and all have stated in one respect that they would like to see the end of single premium PPI sold alongside personal loans.

The PPI attached to loans particularly maybe the subject of mi-selling particularly if the individual is unable to claim on the policy, however the PPI product itself is an excellent product with a very important role particularly in the current economic environment.

Consumers need to be aware that the two kinds of PPI (i.e single and regular premium) are considerably different and they need to check that the insurance that they have purchased continues to meet their changing needs. Consumers need to be rest assured that while the PPI sales process is facing a lot of negative focus in the media, most of the mortgage payment protection insurance (MPPI) sales in particular go through very robust and thorough sales process and majority of these product were correctly advised and sold.

The media need to be more accountable in writing about these financial products and ensure that they do not state that all payment protection is bad and enable consumers to remain confident that Mortgage Payment Protection Insurance is a valuable product that will ultimately help them keep their home.

19 October 2008

The triumph of Bridging Finance in the current property market.

The present property sector is seeing a number of winners emerging as well as the majority of expected people losing out. The number of people losing out is mainly down to the number of new entrant landlords and developers who are now finding it increasing difficult to survive through a very difficult market. Most of these individuals were relying on no money down financing and cash back deals as well as raising equity from purchased property.

There is now a multitude of properties coming to the market and this has given rise to individuals with cash and /or strong equity to maximise opportunities in the present property market. There is agreement across the board that this is the wrong time to put for sale any property, however depending on the price this could be an ideal time to consider potential deals.

There are a number of bridging finance providers who have reacted to this market and developed new innovative products to enable quick completion and the provision of full purchase price funding where there is strong levels of equity available in either the clients own home or other properties.

The current market is and will for the foreseeable future present good opportunities to acquire good quality strong assets and therefore one should consider bridging finance to enable the deal occurring. This is particularly the case where there is a time constraint as most bridging finance providers work on the basis of no requirement for bank statements, accounts, projections, cash flows and also the underwriting is not based on income multiples and purely on the property asset.

The demise of "Family Savings" products

It is surprising how many of the with-profits plan which the life providers were describing as "family savings fund" have deteriorated in value. These policies were sold for a minimum period of 10 years and after the term the client can could cash in on the policy or in some cases part of their policy at any time. These were marketed and sold on the basis of long term savings for events to support the family - for events such as a wedding, university fees and other such matters.
The surrender values of these policies are currently worth less than if the equivalent savings amount was put away in a non-bearing interest account!
I am looking into this a little more detail and analysing the average returns for all the main providers such as Standard Life, Clerical Medical, Friends Provident, Scottish Provident, Scottish Amicable, Scottish Equitable and Prudential.
If there is any secondary information out there or if you have any further information to assist me with this then please contact me on info@easy4life.com

11 October 2008

Quotes from the "Rich Dad Poor Dad" Book

In this time of uncertainty I thought it would be a good motivator to remind ourselves of the contents from this well recommended book.

"Financial Literacy = Know your Assets from your Liabilities."
"An asset = something that puts $$$ in your pocket whether you work or not."
"Choosing to be rich starts by choosing your IDEAS."
"Too many middle-class people try to "keep up with the Joneses". The problem is… the Joneses are broke. They may have the big house, the nice car… but if you study their financial statements, you'll find that they own nothing, they have no assets, they are in debt."
"There is no "job security" anymore - you need "financial" security."
"With every $ that comes into your hand, you have a CHOICE. If you're smart, you'll buy an asset with that dollar."
"Most people are afraid of failing and being rejected. Get over these 2 things, and life is easy!"
"Think big! Leverage your ideas! "How can I reach more people with less effort?"
"To get rich, you need to desire it. Do you have the strong reasons why?"
"Do you wish to learn from your mistakes? Get up once you're down?"
"It's not how much you make that matters - it's how much you keep. Check out your saving/earning ratio. Live below your means! How much actually drops to your bottom line?"
"Who you know can make the biggest difference in your financial life. Get out there and meet people! NETWORK!"
"Poor people are afraid of risk, rejection,fear of losing, losing face… Losing is part of the winning!" "Successful people try and try again, they fail over and over again. At school we are taught that losing and failing is bad. At school, if you make mistakes, you are a "failure". People spend their entire lives fearing MISTAKES. And yet mistakes are how we learn. There is a priceless kernel of knowledge in every mistake. Admit it - don't deny or justify it. Learn from it!"
"Only borrow money when you don't need it."
"Just do it once. "How can I do it just once, for it to return money to me forever?
" Creative multiple streams of passive income!"
"The biggest challenge you have, is dealing with your self-doubt. Challenge your self-doubts!"
"More important than the HOW we achieve financial freedom, is the WHY. Find YOUR reasons why you want to be free and wealthy."
"Most people look for the easy road to wealth, because they lack a strong enough why. The easy road ALWAYS leads to a dead end."
"Stop hanging out with some of the people that are holding you back."
"Thinking is the hardest wish you'll ever do."
"There is no security anymore. You can't rely on Social Security or company pensions for retirement. We need new answers."
"No longer can we simply tell our children to "Go to school, get good grades, and look for a safe, secure job." It's some of the most dangerous advice we could give."
"How many millions of people are out there in the real world struggling financially?"
"The world has changed, but education has not changed with it."
"One of the reasons why the rich get richer and the poor get poorer is that most of us learn about money from our parents. So what scan a poor parent tell their child about money?"
"Rich Dad forbade the words "I can't afford it" - instead, "HOW can I afford it." One lets you off the hook, ad the other forces you to think. "My brain gets stronger every day because I exercise it. The stronger it gets, the more money I can make."
"Poor Dad thought that the rich should pay more in taxes to take care of those less fortunate. Rich Dad said: "Taxes punish those who produce and reward those who don't produce."
"I encourage you to study to be rich, to understand how money works, and to have it work for you!"
"Passion is ANGER and LOVE combined. When it comes to money, most people want to play it safe and feel secure. Passion does not direct them - FEAR does."
"To wake up in the middle of the night terrified about paying bills is a horrible way to live."
"In life, it's not how much money you make that counts, but how much you keep."

Creative Real Estate Online

The CREOnline webiste is a US based webiste however it has many fresh money-making ideas, has an abundance of revealing "how-to" articles, new educational opportunities, and powerful tools for working smarter and increasing your property profits.

In particular I would recommend you read the Lease Options Articles and information as this will be the next big thing in the UK.

The website is:


Property Search Engine

Take a look at Globrix , this site allows you to search nearly every property for sale or to rent in the UK down to the last detail.

It is Not a property listing site, Its a true property search engine. The big difference here is that property listing services such as rightmove.co.uk charge estate agents a fee, and in exchange bring their properties to a wider audience.

Not all Estate Agents are members of such services nor will they pay other property listing services to list their properties, therefore just relying on a property listing site, will not get you access to all the properties available at any one time and you get miss out on a gem!

With this serach engine,estate agents don't have to come to them with a list of properties that they'd like to promote online, they go to them. Globrix tracks down almost every single estate agent (as long as they have a web presence) in the UK and scours their websites, coming back with a reliable list of what's available to buy or rent.


07 October 2008

Alliance and Leicester Fined £7M for PPI Mis-selling

The FSA announced that has fined Alliance & Leicester Bank (A&L) £7m for serious failings in its telephone sales of payment protection insurance (PPI).

The regulator said that between Jan 05 to Dec 07, A&L sold approximately 210,000 PPI policies to customers seeking a personal loan at an average price of £1,265, however there was a general failure by advisers to give customers details of the cost of PPI.

Also, A&L sought to find reasons to sell PPI without considering customers needs. The FSA said A&L did not make it sufficiently clear that PPI was optional and had a culture of training staff to put pressure on customers where they queried the inclusion of PPI in their quotation or challenged advisers' recommendations.

A&L has agreed to implement a substantial and comprehensive customer contact programme, overseen by by a third party. It will write to all customers who took out policies by telephone in conjunction with an unsecured loan between 14 January 2005 and 31 December 2007 prompting them to review their policy against product information sent to them. It will also review any relevant rejected complaints and claims and has committed to pay redress where appropriate. This remedial action has been taken into account by the FSA and has reduced the level of penalty which would otherwise have been imposed on the firm.

Many operators in the financial services market have failings and considerable shortcomings in their sales processes. It is disappointing that after the Pensions mis-selling scandal, the endowment mis-selling and the various investment products mi-sold over the years and even with regulation there is considerable problems.

In a previous posting I stated that there is a unique opportunity for motivated individuals to start their own profitable and No Risk business with No capital outlay. An opportunity exists to assist individuals who have a potential mis-sold financial product to obtain recompense and as stated it is a good business opportunity to establish a Financial Claims Management business specialising in Financial Services.

For further information and to have a initial confidential discussion contact me on info@easy4life.com

04 October 2008

Distressed Property Purchase with No Money Down

For nearly a year the property investment market place has faced considerable change.
These changes have presented many "below market value" property investor with considerable challenges in purchasing property with little or no money down. Majority of the no money down deals used to occur with a closed bridge or daylight bridge and remortgage facility. This is no longer the case due to various lenders withdrawing their mortgage products and changing their criteria.

I am however of the opinion that over the medium to longer term, five to ten years property will remain a strong and excellent asset class and as the past has proven property will give opportunities for long term growth and profit.

Many investors who are operating in the distressed sales market are now looking to purchase again (on average these properties are 25% to 30% below the current "market value" and in some cases even more!) .

As an Impartial Finance Broker, I have a innovative solution to purchase buy to let residential property without a deposit, I can assist to purchase "No Money Down!" .

Please contact me to discuss further.

01 October 2008

Planning Permission and Building Regulations for Householders

There has been a significant number of changes to planning with effect from 01 October 2008.

There is an excellent visual guide which outlines the new rules on common household projects and that can be accessed on the planning portal website.

One area of significant change is that you now need to apply for planning to pave over your front garden.

For further information visit: