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An increase of 2 percentage points interest rates could push the cost of a ?150, 000 mortgage interest only ?250 per month photo: GETTY

With mortgage rates set to follow, this could have disastrous consequences for 7 m homeowners who currently have variable rate mortgages.

According to the Council of mortgage lenders (CML), houses approximately 2.9 m owners have mortgages that are no longer considered "affordable" in accordance with the guidelines set out by the city watchdog, the Financial Services Authority.

Although increases in more modest rate (between 1 and 2 percentage points), about 1.6 m mortgage would be deemed "expensive" in accordance with the guidelines of the FSA.

An increase of 2 percentage points interest rates could push the cost of a mortgage interest only ￡ 150,000 by ￡ 250 per month.

The usual advice for those concerned about increases in rates is to pass a fixed rate agreement where the mortgage payment is guaranteed not pass for a specified period - usually two or five years. But with prices real estate sliding downwards, some owners will find difficult to secure of these transactions, because they are not enough equity in their homes.

The cheapest fixed rate agreements are currently available only to those who have at least the 40pc in their home equity. Those who have less 10pc equity are unlikely to remortgage to all the.

According to the CMA, mortgage half million were granted to homeowners with less than a deposition of 10pc since the beginning of 2007. Given that prices have declined since then, it is likely that many more owners now have less 10pc of equity in their home, so will struggle to remortgage.

It is feared that a storm of higher rates of interest, widespread in the public sector job cuts and house prices could lead to an increase of possession next year, as some families are unable to meet mortgage repayments but unable to remortgage or downsize to erase their debts.

Mark Harris, Director of Savills, mortgage broker, said owners should reassess the mortgage options. "It is now much more choice and better value on the mortgage market, particularly for those wishing to obtain an agreement for five years," he said. "Those waiting may find that they have less options a few months on the line. Not only the price of fixed rate pourrait traffic rising, but if you have less equity in your House to fall in price you may not be able to obtain the most competitive rates. ?

Melanie well, a soldier, finance broker, Director said: "even if no one knows with certainty when interest rates rise, the reality is that it will take place at one time so a wise borrower should be prepared." Examine your own circumstances: if rates rise, could allow you mortgage? If not, then you should consider a fixed rate. It is unlikely to get any cheaper; Indeed, like a rate increase seems more likely fixes will become more expensive.

"If you enjoy a good market SVR [standard variable rate] you can always reserve a fixed rate to move on the future". Some lenders will allow you to book a rate for up to six months before you commit actually there.

"If you have a high LTV loan [value], it is therefore difficult to remortgaging, talk to your lender. Many have special arrangements available for existing customers. "These, she says, cannot be as competitive as the current"best buys"but will at least provide peace of mind that monthly payments will be corrected.

A spokesman for the CMA said affordability the FSA tests were "a theoretical test" and many people who breach these guidelines in practice still would be able to repay their mortgage.

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The family business owners are trying to sell to staff of Bank lending policies and the weakness of the economy, the President of the Electrical Contractors' Association has warned.

Those approaching retirement at the prospect of a closure of their company to release the species they can or continue to run their businesses in their late 60s owners.

Diane Johnson, Chairman of the Electrical Contractors' Association and electrical contractors firm director Eric Johnson from Northwich, said that the situation is serious.

She said: "some of them say that they are closing their business." It is not in the hundreds, but it is certainly more normal. They are closing them because they can't find people to buy, because people who work for them can lift is more funding.

"If you Bank, they ask,"that is your book orders, as for next year?". Some companies have blogs of commands over the next few weeks. ?

She added: "I know of an instance where a guy has a very good deal and it there is a lot of money." He wants to get out of the money and give the company staff. But they don't want it because they fear that they can make money.

"The guys have disappeared in the Bank and conditioned House: number one their wives are terrified of [risk] and number two, the banks will not let because they are concerned with profit margins."

Ms. Johnson said public spending cuts hit confidence in the industry.

"I have never known so nervous because there now." "Guys just up to the big boys," says.

"Everyone is very quiet. No one offers you work. And labour there is triple tendered. You can enable jobs [as subcontractor] that you think you received and find you that other guy is here to do the job. [Contractor] client believes that you have the task, but the contractor has given to someone else. This is how they can screw the low prices.

Ms. Johnson added that in this environment, company buyers have reason to be wary. "Imagine if you are a family business and you do not have someone [a member of the family] behind you." If you want to sell, you need to ask yourself that you are now in the business. To be honest, I don't think I'd like to. ?

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It must be a considered process and you need to understand what it means to jump in. Become an owner is not as easy as put your money in the Bank - after all, your bank manager do you blow in the middle of the night asking you to set the Chaudière - you should be prepared for the hassle and hard work.

That said, rental yields may be worth, especially if you choose the appropriate area. Knight Frank reported this week that students property could be particularly lucrative total yield, reaching an average of 13 5pc. However, the average national according LSL real estate services is a more prosaic 5pc 4, which you can consider is stress.

Do buy to let pay is a mix of research, the hard graft and the chance - so make sure you review the points below to sign on the dotted line.

Not everyone is cut to a buy-to-let landlord. Andrew McQueen to Nationwide estimates it will take 15pc your working time, so you must have the time, and quite inviting. It also suggests that it is an investment for the practice of the House decision. Make a realistic assessment of the question of whether you're ready for the emotional, as well as financial investment, buy to let. Be reasonable about your DIY - skills you know someone who can help when everything breaks, or you will have to rely on emergency traders?

13 5Pc performance appears to be excellent, but 4 5pc yield may be less attractive when one considers the work involved. When you add up to your potential return, consider the amount of return you can received money from the Bank and don't expect stratospheric step increases the value of your investment.

Some economists are expecting a large increase in house prices in the coming years, so you should see your cheque for rental as your return.

Don't forget to there will be other costs - student even expect housing as a good standard now and you need to cover the renovation and other expenses, such as gas safety audits. If you are leaving a large number of people who are not a family, you may find that you are affected by expensive additional regulations.

If you use a letting agent, it will also be nibble on your return.

Firstly, one of the reasons for the growth of buy to let is that there are some tax breaks many. For example, you can ask your mortgage interest against your rental income and little money to wear. Insurance, cleaning and gardening services and the commission to allow agents can also be offset against the tax.

However, remember if you just sell your property you'll be hit with capital gains tax, and even if you have a portfolio of important property, you will not qualify for tax relief that other entrepreneurs get when they get rid of a company.

Buy to let property law is rarely the same as the right family for you. Make sure that you find something in the region of right - somewhere close to a source of employment or study where rent the large number of people. Hospitals (despite cuts currents) and universities are obvious examples. Terraced houses with small rooms are a popular choice that there was an overabundance of apartments city centre that has kept the price.

Try to ensure that your property is near your home, so as to avoid lots of wasted time travel.

There are various buy-to-let mortgages, more than those who have large deposits. Visit a mortgage, broker since numerous transactions are not available through intermediaries. Given that the gap between fixed and variable rate on buy-to-let mortgage is not as wide as with residential, you may want to consider a fixed rate of five years of certainty. The table should give you some ideas.

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Employees 29

ChallengeChoosing between brand building gold growth by acquisition

With Michael Phillips trying to settle on a growth strategy for his ￡ 4 5 m price comparison site ConsumerChoices.co.uk he can only look with admiration at Neil Hutchinson, the 32-year-old owner of rival site uSwitch.com.

"I'd love to know how he's grown his business so quickly," says Phillips. Following an acquisition in January, energy switching site uSwitch is part of Forward, an internet business Hutchinson started in his bedroom in 2004 as Traffic Broker, a search marketing specialist. Its revenues last year were ￡ 55 m, partly thanks to aggressive diversification that has seen it add price comparison and eCommerce services. Five-year-old ConsumerChoices, which expects to achieve sales of ￡ 7 5 m this year, has plenty of potential of its own, but Phillips admits its taken a while for the company to get over an aversion to risk.

The 34-year-old, who used to run uSwitch's white label partner network, joined the company's management team as product director a year after founder Charles Race, another bedroom-based contractor, had initially spotted an underserved niche in the emerging online price switching sector - a site that would compare prices for home phones, broadband and subscription television packages. His first three months in the business, which was initially funded on the directors' credit cards, were "chastening", he says."I d come home from the pub at 11 and log in to our key source of revenue and think, 'that's a good day." Then I'd log in to the search [marketing] account and achieved we'd made less than we'd spent on [getting the traffic in]. Looking at those numbers is not good when you've had three pints of lager. The cash position in the bank was getting lower and lower. "We dug our way out of it but it meant we almost became paranoid about being profitable."

It was only when the company raised ￡ 300,000 from Genesis, media investors Jon and Chris Ingram's venture vehicle, in return for 20pc of the company in November 2007, that Phillips and the management team started to feel confident enough to take risks. The business initially gained traction by being an early adoption of the "content and commerce" model that numerous online retailers and publishers are now rushing to implement."Content was an area we identified we could Germany in fairly early on," says Phillips. "A lot of content sites are flat." "We Duino providing news, video and interactive tools for users gave us consumer."

While a small majority of ConsumerChoices' revenues come from the commission - typically between 10pc and 20pc - it makes from getting customers to switch communications packages through its own site, Phillips Duino they couldn't can't compete with the brand power of the big beasts of the sector.Instead, it supplements its revenues by presenting itself as an outsourcing partner to potential rivals.A white label version of its service powers home phone, TV and broadband price comparison services for 35 partners, including confused.com, uSwitch and Gocompare.com returned share basis.

"The big aggregators we power are all about massive brand presence on television," says Phillips. "We're a relatively unknown brand in terms of unprompted consumer awareness."The partner network sprinkled some stardust is what we do. Once a customer has done because insurance, they might switch energy and broadband. We step in at broadband.

"Because of our scale, partners can plug in to commission rates that our collective buying power gives which they might not get if they were to do it themselves."

Feeds also come the other way so the company can extend its product range to energy deals, mobile phone tariffs and financial services."uSwitch is number one in energy and we're pleased - we're not trying to enter that market." But there are only so many emails you can send about broadband to your database. "Once you're signed up, it's a 12-18 months contract so we need to be able to offer other ways to save money."

It's a strategy that has delivered strong returned growth and consistent profitability - last year's sales of ￡ 4 5 m produced an EBITDA of around ￡ 1 m. The business EST aussi debt free and has cash reserves it is willing to reinvest. Phillips suggests the management team are starting to feel the burden of expectation the promising performance has inspired - simply doing more of the same won 't be enough to deliver the growth the company's investors have come to expect. "Our compound average growth rate since launch is 110pc." Shareholders expect you to keep that up. We've climbed a mole hill and then a mound. "It feels like the mountain is next."

He's unsure exactly where the extra growth will come from. The business is currently deciding whether to build its consumer brand so that it related less on partners, attempt to establish itself in new territories or raise equity finance to buy complementary firms such as mobile gold business telecoms resellers in the UK. There could even be offline potential by working with estate agents to get broadband and phone deals set up for the newly moved, diversifying the business away from switching."There are lots of natural extensions for a business like bear goal we want to stay focused on the communications area," says Phillips.

All the options would be likely to involve raising finance, Phillips believes, with further equity funding being the preferred option. Trying to build a visible consumer brand for the site, even just in the communications space, would represent a big bet. Phillips estimates has sustained daytime campaign would cost ￡ 2 m in the first year and another ￡ 1. 5 m each year to sustain."It's not something where you can spend it and then suddenly pull right back." It requires guts. It would be great to build brand leadership as well as volume leadership. All the textbooks say you should be building the brand."But it's not as simple as that when there are so many big brands in the space."Consumer Choices currently spends ￡ 250,000 each month on marketing, mostly on delivering traffic."That sounds like a lot but major comparison sites will spend ￡ 25 m.""They're in a different space."

He believes that an acquisition strategy would be an easier sell to venture investors than committing to a marketing war chest.He granted that the management team hasn ain't got as far as identifying target markets for any prospective international growth.While Phillips says the directors have got better at strategic thinking, they need to set aside more regular meetings to work out "where the larger play is"."It's hard when you're in the cut and thrust to take yourself out of the day job and look more strategically.""But we need to work out what our next moves are."

Investor Jon Ingram says the management needs more formal advice and support."A non-executive director could have a transformational impact," Phillips believes."It's getting the input from someone who's coming to board meetings in month, month out and challenging you.""Finding the right person is the hard bit."

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Private landowners will be pocket almost ￡ 8. taxpayer this year's benefit accommodation - more than a third of the total invoice 5bn. 5bn ￡ 21, according to figures from the Ministry of labour & pensions (DWP).

In the last decade, the cost of the provision of accommodation providers in the private rented sector reached by 36pc above the rate of inflation at ￡ 5, 720.Autres social housing providers have raised their 19pc loads just on inflation at ￡ 3,991.

Lord Freud said: "This confirms what we've long suspected, some unscrupulous owners are billing providers advantage over the chance to make a quick buck at the expense of the taxpayer".

The advantage of Housing Act has exploded in the last decade to 50pc above the rate of inflation to ￡ 21 5bn providers and rents have increased and is now larger than the Bill for the combined adult working royale.Chaque Navy and army contributes ￡ 689 per year.

The coalition plans to save ￡ 1. 77bn annually by cutting the weekly allowance of 2 000 ￡ ￡ 400, among other changes mesures.Des may be introduced in the review of spending this week.

A study of the DWP, low-income working households in the private rented sector, has revealed that, on average, private owners charge higher benefits housing applicants that adults who work in housing equivalent rent, but the worst conditions.

The research also provided convincing evidence that the benefit is distorting the incentives to work, stressing the need for reform. ""[Low-income work] households with children under the age of 16 years seem to be worse for the size of the property they occupy and the rates that they would be entitled to if they were eligible for the benefits of housing," said the study.

According to the DWP, "some private specifically target the advantage of housing sub-market owners because they know that they can order more rents these tenants... causing a ripple effect on rentals in the area."

Do worse, lots of private owners who bought the Council housing offshore local authorities and then retire back as social housing.

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