ROCK BORROWERS SHOULD SEARCH MARKET FOR BEST HOME-LOAN DEAL

If you want to know where to get the best returns on your cash, what your options are when your mortgage ends or even how to save money on your tax bill, get in touch via the address below.

Q I am coming to the end of a fixed-rate mortgage with Northern Rock next month and have heard C&G is offering special deals to Northern Rock borrowers. Are these likely to be the best on the market?

A Northern Rock customers with fixed-rate deals nearing their end are being offered a range of deals from C&G, available from branches of Lloyds TSB, with the incentive of a waived £99 application fee.

However, this is only for customers with good credit records who want loans worth no more than 80 per cent of their home’s value (80 per cent loan-to-value or LTV).

The rates available for these borrowers are a five-year fix of 6.29 per cent and a two-year fix of 6.45 per cent, although homeowners with lower LTVs may qualify for cheaper fixes.

However, Andrew Montlake atbroker Cobalt Capital, warns that the price of all C&G’s fixes went up last week.

He says: “Rates change all the time but these are not the most competitive at present and you should check Abbey, Halifax and Woolwich prices before signing up.

“Although there are no fees to pay for the Lloyds TSB re-mortgage, this is a common perk among other lenders, so should not be seen as an incentive on its own.

“Northern Rock should be careful it is not acting as an adviser without carrying out due diligence for each borrower and their circumstances. You should not assume that, because you have been written to, this is the right remortgage to take.”

Q I am thinking of starting a regular saver plan with about £100 a month. Which one is the most flexible and pays the most interest?

A “anyone looking to invest £100 per month who would like flexibility could consider the Barclays Bank Monthly Savings Account,” says Michelle Slade, of the money search engine Moneyfacts.co.uk

“The account pays 7.49 per cent gross on investments of between £20 and £250 per month. This is a full, instant-access account, unlike others which either impose penalties for withdrawals or close the account altogether.

“There is also no need to open another savings or current account to get this rate: conditions imposed by some other banks. The account is operated by branch, internet or telephone, so should appeal to many savers.”

Q How much money can a mother give to her daughter and son-in-law each year without it becoming a tax problem?

A There is no capital transfer tax in this country, so you can give anyone any amount of money at any time without immediate tax implications.

The mother may need to take account of potential inheritance tax (IHT), however. If her assets when she dies are worth more than £312,000 (the 2008/9 figure), she may be liable for IHT.

If the mother does not live for a full seven years after making a particular financial gift, it could be included in her estate for inheritance tax purposes.

There are, however, occasions when you can give money away with no fear of IHT.

You can, for example, give away £3,000 a year plus various small gifts without it attracting tax, however briefly you live after doing so. You can also give money to various relatives and friends when they marry or enter a civil
partnership.

There is a useful guide to the inheritance tax exemptions on the DirectGov website.

Q I have come across a policy with Hearts of Oak Benefit Society taken out in the 1940s in my name by my late father. Contributions were made until my father died in April, 1966. How can I find out if the policy is worth anything?

A Hearts of Oak business was transferred to Reliance Mutual last year. You can write to them at: The Great Hall, Mount Pleasant Road, Tunbridge Wells, Kent TN1 1RG; or email: contact@reliancemutual.co.uk. The telephone number is 01892 510033.


CASH QUESTIONS

If you have a financial problem or query, we can help. Every week, Money Matters will answer your questions with help from website CashQuestions.com.

Please write to Money Matters, Daily Express, The Northern & Shell Building, 10 Lower Thames Street, London, EC3R 6EN or email money.matters@express.co.uk.

You can also visit the CashQuestions.com website to have your question answered free by an expert. The site is owned and operated by three finance journalists backed by a group of financial specialists.