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Current account mortgage debt fears

An Aberdeenshire IFA is calling for lenders to toughen up on borrowers who do not stick to their current account mortgage repayment plans.

Geissler Financial Services adviser Wolfgang Geissler says borrowers are not being made aware of the risks attached to current account mortgages.

He says the products have become popular with cash-rich local oil workers earning around £80,000 a year. He fears borrowers see the products as a soft option that will enable them to delay paying off their mortgage indefinitely.

Current account mortgages offered by high-street banks are slowly being replaced by offsets. The former use just one account while the latter use several. Both are secured against a customer&#39s home.

Geissler believes products that do not oblige customers to make regular payments encourage people into debt.

Charcol senior technical manager Ray Boulger says: “I would question whether consumers who are not using all the facilities offered by the account have been sold the right product.”


Verity&#39s view

Norwich Union&#39s decision to charge for guarantees on its policies has met with little controversy, just as with Standard Life. With Standard Life, at least, the tendency has been to say something like: “Well, it is in a mess after its disagreement with the FSA. Something had to be done. There was always a cost […]

Pink Home Loans – Freedom Finance FS 1 Year Discount

Type: Discounted-rate mortgage Discounted term: One year Discount: 1% Payable rate: 4.58% Minimum loan: £25,001 Maximum loan: Up to 90% of valuation subject to a maximum of £300,000, up to 75% of valuation subject to a maximum of £500,000 Income multiples: Based on affordability calculation and credit score Arrangement fee:£385 Redemption fee:5% of amount repaid […]

Government sets up fund for victims of occcupational scheme collapses

The Government is establishing a £400m fund to compensate people who have lost pension rights through collapsed occupational schemes. The fund will give phased payments over the next 20 years, with payments reviewed every three years. Amicus general secretary Derek Simpson says: “The threat of having little or nothing to live on after 30 or […]

NU admits strengthening Govt hand on price cap

Norwich Union has admitted it would not agree to a 1 per cent stakeholder cap if it had its time again and accepted its actions strengthened the Government&#39s hand. Fielding questions from IFAs at Money Marketing Live last week, NU Life chief executive Gary Withers said criticism of the insurer&#39s handling of the price cap […]

Tax avoidance (the fight goes on)

In recent times, we have witnessed high-profile celebrities and sports stars make the headlines for potential tax liabilities on ‘failed’ tax avoidance schemes. We are now used to reading about these individuals, but what about those who advise on such schemes? Read more


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