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- Credit crunch

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- Cost of living

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For sale sign
These signs are staying up longer than they used to as the housing market slows down
 

Credit crunch

 

The world economy is experiencing some difficulty at the moment. The price of fuel is rising and in the UK the price of property is falling. Problems in the US banking system have led to what is now known as 'the credit crunch'. Callum and Jackie discuss this topic and look at some of the language that has become common in the business news.

This week's question: 'Credit crunch' is an expression which has only recently become widespread. When is the first mention that Callum finds of it on the BBC website?

a) January 2007
b) June 2007
c) December 2007

Listen out for the answer to this question at the end of the programme or try searching the website for yourself!


Listen

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Vocabulary from the programme

the credit crunch
a term that has recently become common to describe the situation when it becomes difficult to borrow money at low interest rates. This situation applies to banks and other organisations as well as individuals


the bubble has burst
a period of time when something that has been very successful has come quickly to an end

Example:
"It looks as if the bubble had burst for the property market in the UK."

negative equity
a situation where the value of your property is less than the money you have borrowed to pay for it. If you sell your property you will not be able to repay the money you borrowed

Example:
"Thousands of people are going to find themselves in negative equity if house prices continue to fall."

a first-time buyer
somebody who has never owned property before who is buying for the first time.

a mortgage
the money that is borrowed from a financial organisation to pay for a property

Example:
"It used to be possible to get 100% mortgages, but since the credit crunch this is very rare now."

the property ladder
the process of owning a property then selling it and buying a better property

Example:
"It's very difficult for those on low incomes to get onto the property ladder."



Extras
download audioDownload this programme (mp3 - 1.8 MB)
download scriptProgramme script (pdf - 37 K)
 Try the quiz!


Related links
Global credit crunch - facts and figures
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