Sunday, May 6, 2007

Fake student loans a problem...

Criminal gangs have obtained millions of pounds in student loans by enrolling "ghost students" in universities, a BBC investigation has found. The University admissions body, UCAS, recorded a large increase in suspected fraud to 1,500 cases in 2006.

One fraudster enrolled himself on five different degree courses at the same university and had 17 fake identities.

He collected student loans worth £65,595. His conviction has highlighted flaws in the loans system and UCAS is to double the size of its anti-fraud team to cope with the rise in financial fraud.

Full story [here]

Trouble for UK mortgage owners?

Mortgage owners in the UK could be in trouble if, as expected, the Bank of England decide to put up the rate of interest...

Monthly repayments on a typical £100,000 loan will increase by £16 from June, pushing the cost up from £722 to £738, if the Bank's Monetary Policy Committee lifts interest rates by 0.25% as has been predicted, pushing typical mortgage rates up to 7.5%.

The cost of a home loan will have risen by a full 1% since last summer, following four interest rate hikes, costing typical borrowers some £70 monthly.

Particularly badly hit could be those who are coming off cutting-edge fixed rate loans. They could find their repayments rising sharply as their interest leaps in one go from 5% to 7.5%. Instead of paying around £580 monthly to borrow £100,000, many could find themselves struggling to find an additional £160 each month.

Full story [here]

Lenders profit from giving bad loans...

In what comes as little surprise, a recent report has found that many lender's agents receive a bigger bonus for giving customers bad advice and giving them a loan with poor terms. Read the full story [here]