Friday 14 September 2012

Growth in consumer borrowing in July


Consumer lending in July grew in almost all areas of high street consumer credit.

The Finance & Leasing Association has urged the 
government to ensure that any new regulatory regime for consumer credit supports high street shoppers.

July saw overall growth of 10% in the consumer credit provided by FLA members, compared with the same month in 2011. Store installment credit grew by 33%, car finance by 28% (by value), second-charge mortgages by 11%, and credit cards and personal loans by 2% during the same period. Spending in the store card market fell.

Fiona Hoyle, head of consumer finance at the FLA, told Business Money news: “These figures show the importance of high street credit, whether provided by large retail chains or smaller independent stores, in helping consumers access the goods and services they require. The government will soon be taking decisions on a proposed new regulatory regime for consumer credit, and must ensure that high street businesses can grow and deliver consumer choice.”

Interesting to see that retail finance has grown by such a significant amount compared to other unsecured forms of borrowing like credit cards and personal loans. Store cards which typically have a much higher APR than credit cards and instore retail credit offers dropped, not perhaps that surprising as customers become more aware of how they pay for goods.

Thursday 13 September 2012

Offering Retail Finance to your customers



Based on our recent experiences in the market and client discussion it is clear there are businesses in the market offering a "retail finance solution" who either don't know what true retail finance is or are deliberately misleading potential clients. I'll come back to this in a minute.

Moneysolutionsuk bring you Retail solutions, a genuine alternative to retail finance. Our aim is to give customers more freedom in choosing how they pay for goods and services and you the retailer transparent advice on the variety of retail finance solutions available to you in the marketplace. We can and will where appropriate recommend  a direct lender option to you if we believe that your business will qualify for such an offer. If you can afford to offer your customer interest free credit or subsidised rates on interest bearing credit AND get paid directly by a lender then frankly why wouldn't you? 

Interest free finance is by far the most attractive payment proposition in the market. It is widely used by retailers in many markets from computers to clothes, kitchens to furniture. Granted lenders will credit score each arrangement quite carefully being that they are, after all usually lending on an unsecured basis but you will none the less still find a significant uplift in sales conversions by offering finance to customers.

Retail Finance Solutions

Available to retailers who sell online as well as in store, we can offer businesses a full range of retail finance solutions including traditional point of sale Interest free credit or interest bearing options. Traditional retail credit products such as interest free credit or buy now pay later enable retailers to improve their sales by giving customers choice in how they pay for goods and services. The figures generally banded about are that you will see a 20% uplift in sales, both in terms of average transaction values and incremental sales.

Moneysolutionsuk can also help businesses all over the UK who perhaps can't get a relationship with the mainstream retail finance companies to offer credit or loans as a supplement or alternative to cash or credit card purchases. Now as someone who has  struggled to sell something to businesses he doesn't believe in or agree with I have no issues in saying that should  you be looking at a broker based alternative to retail finance then please be careful about parting with a large up front fee or regular fees, in my opinion you are simply not getting value for money.

For more information on retail finance visit our website and drop us a line or even give us a call - we'll be as straight with you as possibly can be.


Wednesday 12 September 2012

What is a homeowner loan?


A homeowner loan is usually a secured loan that offers you the potential to borrow larger sums than a traditional unsecured personal loan. You will generally find that you will get a lower interest rate than with unsecured borrowing but you are usually required to use your home as a guarantee on your repayments. 

There are several secured loan providers in the Uk each of whom will have different approaches to how they treat the credit history of potential borrowers. The general rule of thumb is the poorer your credit profile the more equity will be required in your property against which to secure against. It is likely also that the APR of the loan in these cases will be higher. Rates on secured loans usually start at around 7% for loans of £20,000 or more to customers with a good credit profile and go up to circa 30% for poorer credit loans.   

Homeowner loans can be useful for many different reasons and lenders typically take a more flexible stance on what they will allow you to use the loan proceeds for because they have ultimate security in your property. It may be for consolidating smaller debts into a single affordable loan with one monthly repayment, home improvements or even to inject funds into your business.

You should always think carefully before taking out a homeowner loan as you risk losing your home if you cannot meet your payments, no different in this case to not paying your mortgage. Make sure also if you are looking for a sum of between £5,000 and £15,000 that you have already considered the unsecured loan options available to you in the marketplace. It is also likely in some cases that your mortgage company could be the answer to your fund raising requirements so do look at this option as well.

The credit crunch with its Bad debt levels and rising money costs have impacted on the unsecured market over recent times but we are seeing a gradual shift. One or two lenders are looking at offering niche unsecured products geared specifically towards home owners. These products will be aimed at home owners with a good credit profile and will enable them to borrow on an unsecured basis but at much higher levels than the mainstream institutions work at. The loans could be used for topping up a house purchase for example where little or negative equity exists.

As with all borrowing be sure to weigh up what you require the money for, how much you actually need and then whether you can afford the repayments. Make sure you have researched the market fully and beware the brokers who charge high up front fees. We only work with reputable lenders and do not charge up front fees on our homeowner loans