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Before that, we have this week's Your Money.
This is Your Money, your weekly guide to making the most of your
cash here every weekend on BBC News television available all week on the
BBC iPlayer. More and more people are seeking
help for problems with payday loans. What alternatives are out there?
Peter tut ton from the debt charity StepChange has the answer for us in
a moment. In recent weeks and months, the talk in most of the
media's been about the return of a bouyant housing market. For some
parts of the country, the property picture looks bleak with nearly half
a million homes stuck in negative equity. As we approach the end of
the tax year, we look at common mistakes people make with savings
and investments. We have tips for how to avoid them.
There's been a big rise in the number of the people struggling with
payday loans. The step change debt charity says nearly 67,000 people
asked for its advice last year. Up over 80% on the year before. The
average client who asked for help had an overall debt of over ?1700
spread across three payday loans. But what are the alternatives? Peter
from StepChange debt charity joins me now. Peter, there's been a rise
of people getting into duct. Why are we seeing this rise? Why are there
more people finding themselves in this sort of trouble? A third more
people contacted our helpline service, in particular a rise in
payday loans. It is because times are still very hard. Household
incomes have been hit hard over a long peered. People are struggling
to make ends meet. People are struggling with basic things, paying
the rent and fuel bills. People are using credit to fill that gap.
Problem is, if you're using a payday loan, a short repayment peered, you
create a bigger gap next month. You get into the cycle of having to use
more and more credit to make ends meet and you fall over badly. I
imagine people going to payday lenders have exhausted what they can
with banks. What other credible alternatives are out there? A lot of
the people we see will have a lot of outstanding credit with mainstream
lenders like banks. The first thing they are exhausting with the banks
is if you are using a payday loan because you can't get credit from
the banks but are making payments to other credit, first thing to do is
ask for help. Rather than think, get more credit, ask for help from your
lenders, get some advice. We would expect lenders to be showing people
in hardship may need to pay less for a period of time until they get back
on their feet. It may be credit but utility providers and landlords.
Credit is not the answer to financial difficulties. If credit
can help you. Before taking it, you think, can I afford to make it pay
it back? If you can pay it back there are other things like credit
unions. They are still patchy but there's a lot of work going on.
Local authorities are working to try to get more provision. Do shopping
around. You may be able to get a cheaper loan. Look at a loan that
takes longer to pay back. Less pressure on your next month's
finances. When people call your charity, what do you offer them? The
first thing is we reassure people there is a way out of debt. It looks
like a nightmare but people can get out. We help people budge he and
prioritise what's important. We find people are not able to pay for food
because she are paying credit agreements. Firstly, make sure you
can pay for your essentials. We help negotiate with creditors,
affordable, sustainable solutions. Other solutions. We can help with
things like bankruptcy and things like that. There are a range of
options out there rather than using credit you cannot afford. Get some
advice if you're struggling. Peter, thank you.
It will cost you more to post a letter from the end of the month.
Royal Mail's announced price inceases. The price of a first`class
stamp will increase by 2p. A second class stamp goes up 3p. If you want
to send a large letter, that anything up to 100 g, you'll have to
pay 3p more. Or second class is a rise of 4p. These prices kick in on
31st March of the In spite of what you're told, many
parts of the UK are not experiencing record house prices. Nearly half a
million households in the UK are still in negative equity meaning
their homes are worth less than their mortgages. That can make it
impossible for such people to sell up and move on. Overall, 8% of
borrowers are in that situation. In are parts of the country where house
prices are falling, the problem appears to have got a lot worse.
Brian Milligan's been finding out. In many parts of the UK, whole
communities have been left behind by the house price recovery elsewhere.
Take this street in West Yorkshire where many houses are still worth
less than their owners' borrowed to buy them. This one is worth 75,000
but the mortgage is for ?95,000 to sell it, the owner would have to pay
the ?20,000 different back to the Bank. I'm paying ?250 per month
extra on top which is barely affordable. They new that full well
when I was negotiating with the bank at the time. But it is the stress
involved, really. A negative equity map of the UK shows a country of
huge housing contrasts. While London has just 1% of borrowers in negative
equity. In Northern Ireland, 41% of mortgages are affected. In the north
of England 16% of borrowers owe more than their homes are worth. A
situation that's got worse in the last six in months. You are finding
there's still a lot of people with negative equity? Like others, this
Tyneside lettings agent has seen a boom in business from those in
negative equity. Those who cannot sell try to rent their homes
instead. Some find banks and building societies unsympathetic. If
you're in negative equity, I do feel sorry. It may be a decision that's
out of your control. You're not able to sell your properties because
you're left with that deficit of ?20,000 which I'm sure the bangs and
mortgage lenders will want repaying. Negative equity is only really a
problem if you have to sell. Some lenders say they will transfer a
mortgage in negative equity to a new home if you have a per ninety job
and can pay extra. The advice is ask. They may allow you to take the
mortgage with you and take that loan that you owe to the next property.
It is not disastrous if that happens. Talk to your lender as
early as possible. Most of the 463,000 borrowers in negative equity
remain stuck until their houses go up in value. Some with blighted
homes across the north are being told that could take another five
years. The big six energy firms have been
told to hand back over ?400 million back to customers. Credit left in
customer accounts when people move or switch suppliers has accumulated
over the past six years. It is estimated 300 million people are
affected. It is investigating whether the return of money to
customers complies with existing rooms.
Enable married couples and civil partners to determine how their
property is shared if their relationships breakdown. Couples can
make pre`nup actuals but courts don't always uphold them.
Some tenants are being ripped off by rogue let he is agents who take
thousands of pounds as holding depot its, refuse to let them move in and
pocket the cash. Around 500 cases have been reported to Trading
Standards authorities in the last couple of years but Shelter say this
is just the tip of the iceberg. Fed up with high mobile phone bills?
They could become a thing of the past. WhatsApp, being bought by
Facebook for ?12 million say it will add a voice calling function. It
wants its app to be on every phone in the world.
The end of the tax year is almost here. But have you made the most of
this year's allowance? In the rush to allocate your cash it is always
East why I to fall foul of mistakes which could cost you dearly.
Tomorrow Stevens joins us now. Tom, why do people leave it to the last
minute? That is one of the key mistakes people make at this time of
year. They leave their ISA allowance to the last minute. It is great we
are talking about savings now but people should be thinking about
savings all the way through the tax year and not just right at the end
which is when they are more likely to make a mistakes. Do you think
this is the biggest mistake people make every year? It is a key
mistake. Others are people tend to hide in the perceived safety of
cash. That's a mistake at the moment because cash rates on ISAs are
extremely low and in fact, below the rate of inflation. You're losing
money over time by doing that. The third mistake is people put all
their eggs in one basket. A lot of our viewers are quite risk averse.
They are happiest in cash. What would you say to them? There things
you can do which are not as safe as cash. So you do need to take a
slightly higher risk by going into the stock market. But you can spread
your money around in what's called a multi`as set fund. It spreads your
money between shares, bonds, property and cash. By doing that,
you reduce your risk but open yourself up to the better returns
you can get from these assets than pureeing cash. `` pure cash of the
Many of our viewers will not have taken up their whole allowance. What
can they do at this late stage? Investigate the idea of starting a
monthly savings plan. If you put your money all in at one go you risk
getting in at a bad time in the marketment if you drip your money in
across the year, once a month put the same amount in. You will smooth
your returns. You will ensure you invest at the bottom of the market
as well as at the top. You put yourself in good regular savings
habits. Your advice, get a plan basically, and have it lined up in
advance? Yes. Easier said than done? It is extremely easy to do. You can
save from as little as ?50 per month and once you've done it, set it up,
you can forget about it. Tom Stevenson from Fidelity, thank you.
The message is have a plan. And get started. Thank you. That's all from
Your Money for this week. News, tips, information on savings,
borrowing, pensions, any time you like online.
You can get updates by following our feed on Twitter.
We are back next week. Goodbye for now.
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