This week: warning for mortgage borrowers; Premium Bonds boost; pound climbs to seven year high against euro; Wonga's alarm bells
Are mortgage borrowers sleepwalking into disaster?
Years of low interest rates could have left millions of borrowers facing huge problems when rates rise. Harsher new lending rules mean they may not be able to remortgage to a decent deal which could leave them on soaring variable rates which could soon become unaffordable.
It means borrowers need to check their rates and act to get a decent deal before it’s too late.
Premium Bonds limit set to climb next Monday
The amount you can stash into government-backed Premium Bonds is climbing to £50,000 from £40,000 next Monday.
Of course such savings may be far beyond your pocket, but it’s a timely reminder of the government-backed savings scheme which hands over two £1m jackpots each month to lucky winners, as well as a whole host of other prizes. In fact more than £60m is actually paid out to more than 2 million prizewinners each month and all prizes are tax-free.
Pound is at seven-year high against the euro
With the pound at a seven-year high against the euro, a 500ml local beer on Spain’s Costa del Sol now costs the equivalent of £1.43, down 26p on the same time last year. And in France, an average evening meal is as much as £4.50 cheaper.
But you can lock-in the good rates now by using a pre-pay currency card. Use the right one and you’ll cut fees, too.
Wonga’s makeover sends out new alarm bells
Britain’s biggest payday lender, Wonga, is trying to reinvent itself. It has ditched the annoying puppets and launched a new campaign featuring what it calls “hardworking people”. Its new ad, first broadcast in prime time this week, features footage of workers including café employees, farmers and dental nurses.
Wonga became synonymous with the worst excesses of the payday lending industry, with its annual percentage rate of 5,853 per cent and stories of vulnerable people being forced into unaffordable debt. It still remains far from being a trusted lender. The loans it offers remain very costly at the new, lower APR of 1,509 per cent.Reuse content