Over the course of the past year, we have constantly been hearing news about companies closing down to new business and others withdrawing their loan products due to the ongoing effects of the credit crunch.

It is therefore quite refreshing to learn that the loan packaging company Y3S has just launched a range of specialised loan products, which are being aimed at the high net worth end of the market and are predominantly being offered through the Independent Financial Adviser (IFA) market.

The packager has arranged agencies with 21 private banks, who will provide the funding for specialist bespoke loans, which will start at £1 million and go up to £25 million. These will of course be secured loans and are likely to use a variety of valuable luxury items such as yachts and works of art as security for the loan.

The secured loans will typically be flexible, with no early repayment penalties and are likely to charge interest at a rate of bank base rate plus 1.75 per cent, with the loan amount being made available in a range of currencies, to suit the borrower. Although the new service has only just launched at the beginning of September, the company has already had enquiries for secured loans totalling more than £750 million.

The director of Y3S loans, Barney Drake, said that the loans were tailored specifically to meet the particular customer’s needs and that no two loans were ever exactly the same. The loans can be used for almost any legal purpose, but are mostly taken out for business expansion plans or tax mitigation.

It’s nice to know that, despite the effects of the global credit crunch making it more difficult than ever for the average man in the street to obtain a mortgage or personal loan, at the top end of the loan market things are going swimmingly well!

It looks as though life is becoming much simpler for anyone in the UK who may be wanting to open a bank account, or is looking to take out a mortgage or a personal loan in the not too distant future, as they will not have to shop around quite as many potential providers, following the news last week that Lloyds TSB has agreed to buy the Halifax Bank of Scotland group for £12.2 billion.

Lloyds TSB has described the take over as an emergency bid to rescue the UK’s biggest provider of mortgages and homeowner loans and although this may be good news for the long term survival of the HBoS group, we appear to be rapidly heading in the direction where there will only be two or three giant banks in the high street to choose from, effectively giving a monopoly to the banks and presenting the average consumer far less choice and probably higher costs on bank accounts and loans.

Under normal circumstances, this take over would have been stopped by the competition commission on the basis that it would create too much of a monopoly. However, the Government have intervened, using a “national interest” loophole within banking legislation to override the monopoly rules.

Lloyds TSB have said that they will cut costs in the new group by around £1 billion by 2011, which inevitably means that there will be a significant level of redundancies and branch closures over the course of the next couple of years. A spokesman for Lloyds TSB said that there would be “elimination of branch duplication” (meaning branch closures) and that “Significant cost savings can be made by combining the networks and back offices of Lloyds TSB and HBoS” (meaning redundancies and head office closures).

As far as names go for the new banking giant, “Lloyds Trustee Savings Bank Halifax Bank of Scotland” may be a little bit of a mouthful for most of us and a snappier name might well be in order, perhaps an anagram of all the initials could make up a suitable name, one that’s not too rude…answers on a post card please!

The credit crunch has had quite a dramatic effect on many people’s lives in the UK, particularly with regard to their financial situation.

Due to the rising cost of living and high mortgage and personal loan costs, many household budgets are being stretched to the limit and in some cases beyond and because of the tighter lending restrictions which have been imposed by the majority of banks and building societies, many of these home owners are unable to re-mortgage their home to obtain a better deal on their home loan in order to ease their financial worries.

Predictably, many of these people are being forced to make cut backs in their lifestyle and regular outgoings and alarmingly, almost half of the population of Britain are planning to stop the plans and policies which offer them financial protection on their loans and family lifestyle, along with savings plans, according to new research which has just been published by American Express Insurance Services.

The survey was conducted across a range of 2000 individuals in the UK and out of those interviewed, 44 per cent said that they were planning to stop their family savings plans.

More worrying than this is the fact that 27 per cent of people are planning to stop paying their health insurance policies and 30 per cent of individuals intend to cancel their payment protection policies on their mortgages and other loans, at the exact time when they are most likely to require this type of insurance due to increasing levels of unemployment and the threat of recession, which in turn can lead to health problems through financial stress.

It is a false economy to cancel protection plans, particularly when we are in a time when they could well be needed to keep the roof above the family’s heads. What is the point of paying premiums for several years and then cancelling the plan once you actually require the benefits it offers.

Certainly it is sensible to cut back on the non essential luxuries in life, but family and loan protection plans should be considered as important as maintaining the repayments on your mortgage and other loans.

The credit crunch has now been with us for well over a year and the financial markets in the UK have settled into a relatively miserable state of doom and gloom, looking forward to see if they are able to make out any sign of light at the end of the tunnel.

The same is true for anyone who may be thinking about trying to apply for a mortgage or homeowner loan, or indeed any type of personal loan, at the moment, as banks and building societies continue to operate a much tighter lending criteria and restrictions on the loans they are prepared to offer.

Many industry experts have offered their own opinions as to how long the effects of the credit crunch will last and although most of these differ to varying degrees, most would agree that we will continue to be in the current situation for some time to come yet.

The latest comments have come from Andrew Hornby at HBoS, who says that the current problems being faced by the UK mortgage and homeowner loan markets are being caused by the massive housing slump in the US and until this problem is resolved, there is very little that the Government, or anyone else in Britain can do to give a boost to the market here.

He also commented that it was likely that confidence would remain at a low level, possibly until 2010 and banks and building societies are likely to continue to be cautious with regard to offering new loans for a further year and a half.

In the meantime, growth in the UK has been languishing at around zero per cent for the last quarter, with the prospect of negative growth to follow for at least the next six months, meaning that the UK will be in a technical recession.

It appears that we will all have to grit our teeth for a while yet and hold on tight to ride out the storm.

The total number of property sales which are completing in the UK fell once more during the month of August, according to the latest figures from the Royal Institute of Chartered Surveyors (RICS).

The report has shown that the level of activity for surveyors has dropped, with the average number of instructions falling to 12.7 per surveyor over a three month period. Some estate agents are now saying that they are making less than one sale each week and most are blaming the lack of liquidity within the banking sector for the problems, continuing to make it extremely hard for an individual to obtain finance to buy a house through a mortgage or homeowner loan.

There has also been a drop in the number of new enquiries from potentially new buyers, although this has only been slight. RICS also commented that in the previous two months, many people selling their homes had dropped the asking price to a more realistic level, given the market conditions, but rather than encouraging potential buyers to enter the market, many have been put off further, saying that they are waiting for prices to drop even lower before they think about applying for loan.

August is traditionally a quiet month for house sales, as the majority of the UK are thinking about holidays rather than buying houses, but it will be interesting to see how things alter in September, once the holidays are over and people start to think about moving into a new home for Christmas.

RICS also said that the level of repossessions on properties where borrowers had defaulted on their mortgages and homeowner loans were still below the numbers seen during the early nineties, admitting that the Governments rescue package may be showing some benefits, but at the same time they criticised other initiatives, such as the changes to stamp duty.

A spokesman for RICS said “The Government’s stamp duty policy will not be enough to kick start transactions and is more likely to assist buy to let investors with better access to finance than the first time buyers it was aimed at. More needs to be done to reinvigorate a market whose confidence has taken a severe knock.”