Moneyfacts.co.uk – weekly product update 17/10/2007
- Paying mortgage with your credit card is not the solution
- &More credit card sees rising rates and falling deal terms
- Accounts for Rugby supporters
Julia Harris, Mortgage Expert at Moneyfacts.co.uk - the leading independent financial comparison site, comments:
Paying your mortgage with your credit card is not the solution
“Shocking figures revealed today from Shelter show that over a million householders have used their credit card to make their mortgage payments or rent over the past twelve months.
“Moneyfacts.co.uk urges borrowers contemplating using their credit card to pay their mortgage to think carefully before going down this road. This is not the answer, and is possibly one of the most expensive solutions you could choose. If you foresee a problem in meeting your mortgage payments, or as soon as you experience any difficulties you must speak with your mortgage company.
“It’s nothing to be embarrassed about, as often unforeseen events or expenses can stretch our incomes too far. Depending if it’s a short-term cash shortage or perhaps a longer term affordability issue your lenders will do their best to offer advice and financial support. It’s in both yours and the lenders interest to make sure you continue to meet your repayments.
“Borrowing to pay your mortgage on your credit card is a dangerous trap. Take the example of an £130K mortgage over 25 years charged at 5.5%. Putting just one months mortgage payment of £740 on an average credit card and making only the minimum payments to the card could see this debt stay with you for 19 years and 10 months, incurring a staggering £1359.97 in interest.
“The average cash rate today is 23.54%, but can stretch as high as 46.19%. And you must remember that any cash advance will incur interest from day one, so even if you pay off your balance in full the following month you will still face an interest bill.
“If you do find your mortgage payments a struggle, the first step you should take is to undertake a full review of your finances. Write down how much your bills cost and assess whether there are any luxuries you can afford to stop for a short time. Give yourself a budget and stick to it. There are also several debt advice charities available, who offer independent and impartial advice and guidance.
“But if you find, no matter how hard you budget, you can’t make ends meet, then there are ways to reduce your monthly mortgage repayments. Your lender may let you make partial repayments, revert to interest only or even extend the term of your loan to keep your repayments to a manageable level.”
Samantha Owens, Head of Personal Finance at Moneyfacts.co.uk - the leading independent financial comparison site, comments:
&More credit card sees rising rates and falling deal terms
“The &More MasterCard from Marks & Spencer Money continues to offer its competitive loyalty rewards scheme, but today its purchase rate increases by 1% to 18.9% and sadly its competitive life of balance deal, previously at 5.9%, now becomes 7.9% for only two years.
“The nine months 0% on purchases is competitive, but with a reverts-to standard rate of 18.9% it could be a costly way to borrow once your deal finishes. With very few life of balance transfer deals on offer, the market is virtuallydisappearing before our eyes. With 4.9% fixed for five years available from First Direct, the new Marks & Spencer deals does not come close.”
Rachel Thrussell, Head of Savings at Moneyfacts.co.uk - the leading independent financial comparison site, comments:
Accounts for Rugby supporters
“With the nation gripped by Rugby fever, fans could look to invest in a Rugby affinity account to continue their support the whole year through. With only six accounts to choose from, covering both the Rugby League and Union, the market is significantly smaller than for football or charity savings accounts.
“Although the interest rates on these accounts are not market leading when compared with some of the online savings accounts currently available, the rates are in line with many branch based accounts. However it’s not just about the interest you’ll receive as an individual; there is a trade off in that some financial benefit is given to your club.”
Rugby Club |
Institution |
Min Deposit |
Rate % Gross |
Donation Pa |
Notes |
BRADFORD BULLS |
YORKSHIRE BS |
£100 |
4.25% |
1.00% |
2 withdrawals per month. Min £1 for under 18s. |
RUGBY FOOTBALL UNION |
CHELSEA BS |
£250 |
3.95% |
1.00% |
2 free tickets to Emirate Sevens Tournament at Twickenham in May 2008 |
BATH RUGBY COMMUNITY FOUNDATION |
STROUD & SWINDON BS |
£100 |
3.65% |
1.00% |
- |
WARRINGTON WOLVES RLFC |
CHESHIRE BS |
£1 |
3.50% |
1.00% |
6 withdrawals pa then rate reduces. |
BRISTOL RUGBY CLUB |
BRITANNIA BS |
£100 |
3.00% |
Up to 1.00% |
- |
LEEDS RUGBY LTD |
LEEDS BS |
£100 |
2.25% |
1.00% |
1 withdrawal per week. Voucher for 2 tickets to a super league or rugby union premiership game. 10% off “Headingley Experience” |
Moneyfacts.co.uk – the money search engine |
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Moneyfacts Group
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