After what feels as though a long time in recession, lenders are still not keen to lend and before UK general election is over, it doesn't feel like very much will change.
Pre market meltdown times had a home loan market providing more than 25,000 different mortgage deals and loans galore, but today the united kingdom markets have less than 5000 mortgage products on offer to the consumer.
So where did the credit crunch come from and could it happen again?
THE UNITED STATES finance markets imploded in the 4th quarter of 2007 due to bad credit on the balance sheets of large finance institutions, which ultimately caused what's known as a credit crunch.
In a market meltdown, lenders stop lending and start hoarding cash because they are afraid of rising debt, resulting in bankruptcies and loan or mortgage defaults. They charge higher interest levels in a bid to stem the flow of business or reject all however the safest loans.
The UK economy have been flooded with accessible borrowed money since the mid 90's, but the credit crunch meant that tightened credit would spell trouble for companies who needing funding by means of loans to pursue their business plans and the buyer, who had become used to freely spending money they didn't have, but could easily access on bank cards for expensive purchases such as luxurious holidays and smart cars.
www.veronikawoell.com to could it happen again is really a simple one, YES!
If an appetite for investment in more risky markets returns, that you've to say it will, then pushing the limits commercially to get extra percentage market share and profit, could lead to the whole lot happening yet again. Having said that, it will require sometime to get there, as returning confidence to dabble by investors will undoubtedly be slow to come back, but memories will return and the painful effects will be forgotten.
So, how is the man on the road directly affected?
UK mortgage and loan lenders are releasing more new products every day and the best mortgage deals of today are soon replaced tomorrow, however the good news is that the deals are receiving better and better. The percentage levels that lenders will loan to is increasing and a 90% mortgage, with a competitive interest is out there found, if you know where you can look.
Just how do Independent Financial Advisers add value?
Independent Financial Advisers (IFA's) are in a position to search the marketplace, compare mortgage rates on their client's behalf and secure an excellent mortgage rate to match the borrower's exact needs. Besides finance, IFA's can offer a good value for money service if you're looking to source good quality, affordability, but cheap life insurance cover and pension plans, with advice that's specifically tailored to the individual or families needs.
Financial advice is available in many guises, the internet has led to various channels being designed for the consumer to utilise when seeking insight. Finance related price comparison websites have the added benefit of being truly a one stop look for all mortgage, loan and insurance needs. By completing your details once, you have the benefit of utilizing their services to trawl the marketplace and find you the best deals available, but there is still a disagreement for utilizing the services of a local for you, independent financial adviser. The IFA may take the time to understand any unusual circumstances that you will find and tailor their financial advice accordingly plus some finance price comparison websites are now offering both options under one roof to facilitate the needs of a far wider consumer group.