David Prosser: Can I have a fairer deal, please Carol?

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The Independent Online

Countdown's Carol Vorderman must be praying that "petition" is the one eight-letter word that doesn't come up on the show any time soon. Poor old Carol is under fire for her lucrative advertising contract with First Plus, a company that offers expensive secured loans to borrowers keen to consolidate their debts.

More than 500,000 consumers have already been asked to sign a petition demanding that Vorderman stops advertising First Plus's loans. The debt it offers is significantly more expensive than most mortgages - and more costly even than many unsecured loans, where your home is not at risk if you fall behind with payments.

Is it fair to target her so personally? I think so. You could argue that celebrities get paid to advertise products all the time - some are better than others, but it's ultimately up to consumers to decide whether to buy.

However, Vorderman is best-known for her mathematical brain. So when she endorses secured loans for people struggling with debts, there's no doubt borrowers will take notice.

In this case, the figures just don't add up. Debt experts say consolidating all your borrowing into one large loan is rarely the best option, particularly if you have to use your home as collateral. In fact, the Consumer Credit Counselling Service (CCCS), the UK's most respected debt adviser, says a secured loan is an appropriate solution for just 3 per cent of people with debt problems.

In some of Vorderman's adverts, she says First Plus's loans could cut borrowers' total monthly repayments. But that's only because the debt will be repaid over a much longer period, earning the lender substantially more interest over the loan's full term.

Take a £10,000 debt repayable over five years. Assuming you're charged 15 per cent interest on this borrowing, you'll pay £233 a month, with total interest charges coming to £4,000 over the term of the loan. Move the debt on to a secured loan costing, say, 12.9 per cent, repayable over 25 years, and the monthly repayment drops to £117. Meanwhile, the total interest charge rises to a staggering £22,000.

Secured loans are poor value for other reasons too. Most lenders charge a rate that depends on your credit history - the worse your debt problems, the more you'll pay. Rates are generally variable, unlike on unsecured loans, so what you pay may increase in future. You may also have to take out expensive payment protection insurance in order to obtain the loan.

All in all, secured loans are the wrong option for almost everyone worried about how much they owe. Free services such as the CCCS can help you find much better solutions, even negotiating with creditors on your behalf.

Let's hope Vorderman does the right thing. This is her chance to prove that for her, the numbers on the cheque she receives from First Plus are not the most important figures of all.

n n n If you're one of 250,000 investors in Anthony Bolton's hugely successful Fidelity Special Situations fund, get ready to make a decision. In recent days, you should have received a letter from Fidelity, reiterating its plan to split the £6.5bn fund in two later this year. Bolton will run one of the new funds, but not the other.

Investors must vote on the proposals in a ballot in July. But should you sell your holding in the run up to the split? After all, at least half your cash will no longer be managed by Bolton - we don't even know yet who is to run the second fund, or what its investment objectives will be.

Moreover, Bolton is to step down from Special Situations completely at the end of next year, so maybe it's time to get out now while the going is still good.

For now, independent financial advisers think not, - they suggest at least waiting until next month, when Fidelity will announce who is to run the second fund. However, that could be the sell trigger, even if you only dump half your holding.

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