uSwitch comment on news that Firstplus is to stop writing new business from 9th August 2008

Edited by the Insidemoneytalk editorial team Jul 10, 2008

In response to today's news that Firstplus, the UK's largest provider of secured loans - owned by Barclaycard - is to stop writing new business from 9th August 2008,

Nick White, Director of Personal Finance at uSwitch.com, the price comparison and switching service, is available for comment and broadcaset interviews.

Firstplus, the market leader in homeowner loans and best known for its adverts fronted by Carol Vorderman, has confirmed that it will be closed to new business from 9 August 2008 and will make 300 job cuts.

Firstplus is "market leader" in home loans with 128,000 customers, 430 staff and ?4.7 billion in receivables.

Today's news is a huge blow to the personal loans market and another signal that the consumer credit market is quickly drying up.

Their departure will leave just seven players in the market, down from 18 last year before the credit crunch hit.

A large proportion of business is sent to them via brokers.

Brokers will now struggle to help consumers that need secured loans and consumers will in turn struggle to get hold of cheap consolidation loans as companies continue to tighten their lending criteria.

Lenders have reduced the amount of credit on offer to applicants and is undoubtedly harder to come by.

Having the wrong, or uncompetitive, financial products can mean consumers are wasting money that could be put to better use.

Anyone with outstanding debts in need of refinancing onto a cheaper deal needs to act now to secure a competitive loan before rates increase any further.