Nationwide Cuts Mortgage Rates

The Nationwide Building Society has cut mortgage rates by as much as 0.84% in a sign that competition is finally returning to the market for housing finance. The average cut across about 30 mortgage products of Britain's biggest building society is 0.23%. This is a welcome sign for those people who took out fixed mortgages 2 years ago when the LIBOR interest rate went above 6% following the near-collapse and Government take over of Northern Rock. At the time, bankers were unable to source funds on the wholesale markets.

The Nationwide's rate for a 4 year fixed mortgage will fall from 5.78% to 4.94%. Both HSBC and Abbey have recently tweaked their mortgage products. Various house price indices have indicated that the housing market is now past its bottom encouraging lenders to re-enter the market for 90 and 95% loan to value mortgages. The best deals remain for those borrowing less than 60% of their property's value.

Halifax Credit Cards and Inertia Theft

Why are The Halifax so useless? I started dealing with them 8 years ago when I took out a Halifax credit card and I've regretted it ever since. Now that their parent company HBOS is largely owned by the tax payer I'm ever angrier with their incompetence.

I fell out with them about a year ago over a dispute with a supplier. Halifax told me that I would have to pay the sum involved. In order to prevent that happening I told them I would close the account. Halifax said I couldn't do that because there was a £9.90 balance that wasn't due for 3 weeks. I paid the balance immediately and asked for the account to be closed. I was referred to several people before that accepted my request. However, they never closed the account. At the end of the month, £9.90 was taken from my bank account. This left a positive balance. But I'd stopped using the card and, as far as I was concerned, had closed the account.

Six months later I received a letter saying that as I hadn't used the card for some time, my credit limit would immediately be reduced from £15,000 to £500, then closed 4 weeks later. As far as I was concerned the account was already closed!!!

Any how I phoned Halifax, told them the facts and asked for my money. The £9.90 balance outstanding. According to the person on the phone this couldn't be returned unless I put my request in writing. Which I duly did. Today I've received a letter - a standard one - from an Angela Taylor who styles herself Senior Manager, Customer Services, that explains all manner of restrictions relating to future charges but no mention of the money they owe me. Given the effort I've put in to get my money I can only put this down to a deliberate policy of inertia theft. Its only a small sum. But the Halifax are driving me mad.

Interestingly, my business holds a current account with Bank of Scotland. I am so p****d of with them I'll be transferring that to another bank. Preferably one that isn't in hock to the tax payer.

Why the 50% Tax Rate Should Be Abolished

Philip Johnston of The Daily Telegraph uses an extremely amusing example of why the proposed 50p rate of income tax should be abolished. The example uses pints of beer. Where the drinkers are charged according to how much they earn. The poorest pay nothing and the rich pay the most. Everything goes well until a tax cut means the richest drinker gets the biggest rebate. The other drinkers take exception and in response attack the richest drinker. He promptly leaves the drinking circle, forcing up the price of beer for everyone else.

The moral of the story is that it doesn't take many rich people to drop out of the tax system before everyone else ends up paying more. Interestingly, in the real world, Britain has done a good job attracting tax payers from all levels. It is the richest ones who are the most mobile - take top class footballers and celebrities as recent and newsworthy examples. Just a few of these tax payers may well end up leaving in the short term. But in the long run not only will large numbers leave but fewer of the highest earners will come to Britain in the first place.

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