Most people define a mortgage on the rate of interest it offers – but with most mortgages, particularly complex ones like self cert mortgages, the headline rate is just one aspect of the entire deal.

Analysis from moneysupermarket.com has found that the arrangement fee charged on a mortgage can be a crucial factor in determining the overall cost of the deal. For example, it found one tracker at 1.99% which would cost an extra £2,600 over two years compared to one at 2.49% with a flat fee of £995. It also found another two year fixed rate deal at 3.44% working out £1,176 cheaper than the 1.99% deal as it carries a £595 fee.

Essentially, the fee can be as important as the rate. A good rule of thumb is the cheaper the rate, the higher the fee – it's a matter of finding the best mix of both for your situation.

Hannah-Mercedes Skenfield, mortgages channel manager at moneysupermarket.com, says: “Although we have started to see a welcome improvement in the mortgage market, with the number of products increasing, and rates starting to fall, we are still seeing some products being promoted for marketing impact, rather than real borrower benefit. Using high fees enables lenders to showcase extremely low rates without losing any of the profit.

“The size of the arrangement fee plays an important part in the overall cost of a mortgage. A more expensive fee may well be worth paying in order to secure a low rate on a large mortgage, but only if that fee is a fixed amount. Mortgage products with percentage fees rarely stand up to those with flat fees, even if their rates are considerably lower.”

So talk to a mortgage professional when it comes to choosing a loan because they can help you find the middle ground between a self cert mortgage with a cheap rate and a low fee.

SOURCE: Moneysupermarket.com, 11/02/10

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Celebrity culture has invaded every part of our lives and its no different when it comes to small business experts – but if you want to get ahead you shouldn't listen to the so-called experts on TV.

Thankfully most small business people in the UK are not listening to the likes of Sir Alan Sugar or the dragons of Dragons' Den. According to Nottingham University Business School there is some frustration from people running small businesses that media portrayals don’t match their experiences and the challenges they face.

Only 11% of small business people thought the glossy small business experts on TV understood their experiences. Also, only 20% were able to say that media reporting reflects their experiences highly or reasonably highly, while 35% said that it does not reflect their experience at all, or not much. 

In fact, over 70% of respondents said that they thought it would be highly worthwhile or reasonably worthwhile for some small business advisers to work directly with media to improve the quality and coverage of smaller businesses.



Professor Martin Binks, director of the University of Nottingham Institute for Enterprise and Innovation says: “These views raise important questions as to where people can find accurate information on which to base decisions about being an entrepreneur."


It's good to see that small business owners don't take much notice of the reality celebrities. The twits on TV will not be able to help them run their business day-to-day, they have no understanding of what you need to do if you are struggling to get by as a small business person in the real world.

A small business adviser actually understands the financial problems small business people face. They do not do their business in a studio and they do not need lights and cameras to sound like they know what they are talking about. Small business advisers are real people living in the same world as all the struggling small business borrowers out there. They will be able to talk to you on your level and will give you real advice for the real world.

SOURCE: Nottingham Business School, 11/02/10

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The Government has pledged to do more to make sure that borrowing increases for small business and the self employed person – but don't wait around for bureaucracy, get proactive with some professional help.

Lord Myners, financial services secretary to the Treasury, says: "The extraordinary events in credit markets over the past two years have shown that the continued availability of any single form of business finance cannot be taken for granted. Right across the world, firms that had relied on loans from banks to finance their operations found themselves in a very difficult situation when bank lending contracted."

The Government hopes to use the lessons learned from big business and see whether it is possible for small businesses to get hold of money through the money markets or through corporate bonds. It's a good idea, but one that will take time to get through the bureaucracy of government. If you need money you need money now, not in five years.

That's why you need to get proactive if you are seeking out self employed or small business credit, and that means seeking out a professional adviser who can point you in the right direction with regard to loans and mortgages for the self employed and for small business.

It is tough to access credit for the self employed, and it will get easier in the future. But if you need your money now, see what a professional can do to help you through the mine field that is small business and self employed credit in 2010.

SOURCE: HMT, 12/01/10

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Many people who own their own business are having to cut down on the festive activities this year as well as cutting out bonuses for themselves and their staff for 2008.

Almost half of small business people are not going to have a Christmas party this year and 46% will not be paying any bonuses, according to new research from uSwitchforbusiness.com.

The website found that 80% of SMEs have found 2009 to be a tough year – as a result, 58% of business owners were forced to find ways to cut costs and only a third were able to leave staff perks unscathed. And it seems that 2009 is going to end on the same somber note, with business owners keeping a tight lid on celebrations and bonuses so that they can continue to balance the books.

Staff may be disappointed, but in the longer term there should be much better news. Almost half of of small businesses can see some signs of economic recovery. This is good news because as these greenshoots strengthen jobs should become more secure, credit will be more readily available and companies will be able to ease back on cost cutting and hopefully be in a position to start rewarding loyal workers again.

Jake Ridge, SME expert at uSwitchforbusiness.com says: "2009 has been a difficult year for small business so it's not surprising that many feel forced to pull the plug on the traditional Christmas party and end of year bonuses. These are difficult decisions to make and could have an impact on staff morale and loyalty. For those employees hit by the double whammy it's going to feel like a real damp squib of a Christmas."

If you have been forced to cut down on Christmas this year then you should be congratulated – it's a tough time to reign in the spending, but making cuts now and putting money where it is needed will help your enterprise innumerably in the future. If you need even more help, talk to a financial expert about new loans and mortgages that could help your business survive the downturn.

SOURCE: uSwitch.com, 01/12/09

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If you are struggling to keep up with your self cert mortgage then get proactive and work towards fixing your problems in 2010 with the help of a good self cert mortgage professional.

Many people who took out a self cert mortgage a few years ago are now finding it hard to keep up with repayments – their work may have dried up in the downturn, they may have self-inflated how much they earn to get a better deal or they may have been made unemployed – however they have found themselves in trouble a self cert mortgage professional can help.

And it is help you need – trying to solve serious debt problems alone isn't a good idea. When you are struggling you tend to make hasty decisions that could help in the short term but end up affecting you badly in the long term. Also you may not know what financial options and financial products are out there on the market that could have a positive influence on your finances.

So talk to a professional mortgage adviser who specialises in self cert loans. They will know exactly what's on the market for you and they will know exactly what you need to do to have a good shot of getting hold of them. It might mean a remortgage, it might mean mortgaging with another lender or it might mean arranging and consolidating your debts so as to limit your outgoings and keep your head above water.

The worst thing you can do with self cert adverse debts is ignore them. They are only going to become more severe if they are not addressed and that means more problems for you further down the line. So deal with your problems now and look forward to a more positive 2010.

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With the right financial advice any small business can handle anything that is thrown at it – less sales, sickness, injury or even a flash flood – the right small business insurance schemes can make a good small business bullet-proof.

But if you are a small business owner who has not got insurance, but has small business loans, then you may be facing arrears and even repossession thanks to loss of earnings and huge damage costs if the worst were to happen.

There is some help for these people – the Federation of Small Businesses recently opened its £500,000 Disaster Recovery Fund for its members in Northern England and Scotland, which have been adversely affected by recent heavy rain and flooding. It is offering interest-free loans of up to £5,000 to help small firms cover costs associated with keeping their business trading and with repair of their premises.

John Wright, national chairman of the FSB says: "The last 18 months have been difficult for FSB members up and down the country, so the last thing otherwise successful small business people need is unpredictable weather and flooding to damage their prospects."

This is a great gesture from the FSB, but those businesses taking the emergency fund needn't of had to resort to the kindness of others if they had got the right cover. A good insurance scheme would make sure a business can afford repairs, can pay debts while not earning and could even allow business people to recoup lost earnings.

Make sure your small business is properly covered should the worst happen. A flood can hit without much warning, as a lot of Brits have found out recently, so don't take anything to chance. Talk to a financial adviser about the right insurance premiums for your business loans.

SOURCE: FSB, 20/11/09

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The Government will soon announce how much they will be hoping to spend in 2010 – but how much will you be spending and borrowing next year?

At the pre-Budget report on December 9, the Chancellor Alistair Darling will stand up and outline what can be spent and what has to be saved, nationally.

According to the Centre for Economic and Business Research, as of the end of October, the public sector net debt stands at 59.2% of our entire GDP – CEBR says that means the UK deficit for 2010 is £193bn. There is no doubt that because we owe so much the Government will have had to sit down for a long time and work out its finances very, very carefully.

There is no difference between what the Chancellor is doing now and what you should be doing with your finances. Yes, Mr Darling has to work out how to repay a little more than you may owe, but regardless of that you need to set out your own pre-Budget report if you want to be sure to reduce your deficit in 2010.

It means sitting down and assessing all your debts and all your income. Just as the Government will weigh up tax increases with spending, so must you weigh up where you need to pay down debt and where you need to spend.

Of course, the Chancellor has a raft of advisers to help him out, and like him you need to find some advice – so talk to a professional self employed loan adviser. They will be able to not only help you with your own budget, but they will be able to advise and guide you as to how to handle your own budget deficit. It might not be quite as much as £193bn, but we all have debts and we all have to plan on handling them and reducing them successfully in 2010.

SOURCE: CEBR, 19/11/09

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New research released by Abbey reveals that small business borrowers are working longer hours in the face of the current economic downturn.

One in three small business borrowers say that they are now working longer hours than they were just one year ago – the average amount of time a small business owner spends working is 47 hours per week, just one hour less than the maximum number of working hours permitted by the EU.

However, many are working much longer in order to maintain and develop their business, with a third of small business borrowers now working over 50 hours per week and one in six working in excess of 65 hours a week – the equivalent of a minimum of 13 hours per day over a five day working week.

But, with the number of insolvencies up by 39% in the second quarter of 2009, compared to the same period in 2008, many small business owners are being forced to work these longer hours, simply to keep their business afloat.

Paula Ickinger, head of business banking marketing at Abbey says: "The recession is having a huge impact on small businesses in this country and many owners are sacrificing their work-life balance by working longer hours as they struggle for the survival of their business.

"Not only do business owners have a very tough economic climate to contend with, they've also been burdened with mounting piles of red tape and bureaucracy at the same time, which can distract them from the running of their business. They therefore need to make sure that they are getting as much help from their suppliers as they can, including their business bank."

There is nothing wrong with asking for help. A financial adviser, if asked, can help you redress your finances and maybe help set you up with new loans and mortgages in an attempt to lower outgoings and give you a break. But for all this to happen you have to speak up – ask your small business financial adviser for a guiding hand today.

SOURCE: Abbey, 16/11/09

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If you are a self employed person you have probably only recently finished grappling with your taxes – but more people need to get to grips with the basics of tax, according to a new survey.

New research from Fidelity International has found that the nation is suffering from high levels of tax illiteracy – an estimated 33 million UK tax payers are confused about tax.

Fidelity's report has found that over one in seven UK taxpayers admit they don't even know which tax band they are currently in. And there seems to be even more confusion amongst those that claim to know – with over a quarter of people with taxable income in excess of £50,000 thinking they only pay a basic rate of tax.

This confusion could explain the inertia of the population to make the most of the tax efficient financial products available to them – why two in five of those surveyed have yet to take any action to make themselves more tax efficient. Indeed, a quarter believe there is nothing they can do to reduce their tax liability.

This lack of knowledge could mean that people are needlessly gifting money to the taxman, simply because their finances are not tax efficient.

Paul Kennedy, head of tax and trust planning at Fidelity International, says: "Just as the Government takes a slice of your earnings in tax so too does it take a slice of the returns you make on your finances. By planning our finances wisely, we can make them more tax efficient. Tax efficient, simply means arranging things in a way so that we keep the tax on our finances to a minimum – and that means more for us and less for the taxman."

Do you know if your self employed finances tax efficient? Are you needlessly handing over money to the taxman? The only way you can know is by talking to a financial professional who understands how tax works and understands self employed financial products.

SOURCE: Fidelity, 13/11/09

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These days the idea of retiring at 60 or 65 is a thing of the past as people look to work into their seventies – but have you thought about how your finances would cope in old age?

If not , you should be because other people probably are – in fact, 1.8 million people are expected to be working beyond traditional retirement ages in just 10 years.

The findings are from new research by Prudential. It found that nearly a quarter of companies expect staff to work beyond retirement age in the next 10 years. This could mean that 6.3% of the workforce in the UK by 2019 will be made up of people working beyond statutory retirement ages.

If you are one of these people who are fit and well enough to carry on enjoying their work, how will you cope financially? Will you have paid off your mortgage? Will you have enough savings? What about a pension?

Martyn Bogira, director of defined contribution solutions at Prudential, says: "The statutory retirement age for men and women is due to rise to 68 by 2046, so working longer will be a fact of life for those entering the workforce today but these findings suggest that increasing numbers of pensioners will be forced to work later far sooner than this."

It is never to early to think about the future. You may want to work past 65 and you may want to start working towards retirement. You may want to think about your pension, or you might want to think about beginning on that nest egg. And then what about your mortgage? Do you want to have paid off your debt? Can you be sure you will be debt-free by the time you finish working?

Don't start worrying, talk to a financial adviser. They can help you see into the future and help you choose the right financial options that will make your long-term plans a reality.

SOURCE: Prudential, 10/11/09

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