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Millions of households set to have their energy bills capped for another year

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millions of households set to have their energy bills capped for another year

Millions of UK households will continue having their bills capped until the end of next year, the Government has revealed.

The energy price cap was introduced in January 2019 in a bid to moderate bills for many households – especially those who had never moved from expensive standard variable tariffs.

Around 11million homes are currently saving money under the scheme with the Department for Business, Energy and Industrial Strategy claiming it has saved customers around £1billion a year – equivalent to £75 to £100 per household.

It has now been extended to the end of 2021 to stop customers paying over the odds, but experts are nevertheless encouraging households on pricey default tariffs to switch.

The energy price cap has been extended until the end of 2021, as people try to save money

The energy price cap has been extended until the end of 2021, as people try to save money

In August, the independent energy regulator Ofgem recommended an extension to the cap following a review into the market. 

Alok Sharma, Business and Energy Secretary, said: ‘The energy price cap has been vital in ensuring customers do not pay too much on their bills, which is why we are keeping it in place for at least another year.

‘Switching energy supplier to find the best value deals is still the best way to save on bills, but this government is determined to make sure all customers are treated fairly and get the protection they deserve.’

The extension also means a further four million households with prepayment meters on default tariffs will continue to be protected from excessive prices by the wider price cap once the Competition and Market Authority’s Prepayment Meter Cap expires at the end of 2020.

Jonathan Brearley, Chief Executive of Ofgem, added: ‘The Secretary of State’s announcement means that millions of households will continue to be protected under the price cap and will pay a fair price for their energy in 2021.

‘Although those protected by the cap are paying a fair price, they can also reduce their energy bills further by shopping around for a better deal.

‘Ofgem will continue to protect consumers in the difficult months ahead as we work with industry and government to build a greener, fairer energy system.’

Ofgem’s cap is reviewed every six months and the most recent one came into force earlier this month, with the level dropping from £1,126 to £1,042 a year for default tariff customers.

Suppliers are not allowed to charge above the cap but they can offer cheaper deals for savvy customers.

The savings are bigger for prepayment meter customers who saw their bills drop by £95 from £1,164 to £1,069 on 1 October. The current cap will remain in place until April 2021 when the level will be reviewed.

The energy price cap has been introduced as a way of keeping bills down for households

The energy price cap has been introduced as a way of keeping bills down for households

Research by the Competition and Markets Authority showed that consumers on default tariffs had been overpaying the ‘Big Six’ energy companies some £1.4billion a year before the introduction of the cap. 

The news comes after it was revealed yesterday that households struggling to pay for their energy will get emergency credit this winter under new regulations from the watchdog.

Providers will now have to offer emergency credit to customers struggling to top up their prepayment meter to provide breathing space while working out alternative arrangements to pay.

Ofgem is introducing the new licence rules for suppliers from 15 December, following a consultation opened in June.

Despite the news suggesting households could save money through the price cap, industry experts have been critical of it, suggesting that households could save more money by switching supplier – instead of sticking to a pricey default tariff.

Richard Neudegg, head of regulation at Uswitch, said: ‘It’s no surprise to see the Government confirming Ofgem’s recommendation from August to keep the price cap in place for another year, given there is a lot of work still to be done reforming and modernising the way the energy market works.

‘The extension of the energy price cap will be reassuring news for millions of people who are facing financial uncertainty this winter. Unfortunately, more than half of customers are still on standard variable or default tariffs.

‘The only way to escape high bills and ensure you’re not paying more for your energy than you should is by switching to a cheaper deal. 

‘I encourage anyone concerned about their bills to take the time to compare energy deals and see if you could be getting a cheaper tariff. By switching now there is time to make substantial savings to energy bills before the cold weather takes hold.’

Peter Earl, head of energy at Compare the Market, added: ‘The cap was originally introduced with the worthy goal of preventing energy suppliers from hiking prices unfairly for their more loyal customers and charging them over the odds for their energy.

‘In practice, however, confusion about the price cap could be leading people to pay more for their energy than they ought to.

‘As the long list of tariffs priced cheaper than the cap demonstrates, the new cap is not a good price to pay for energy – far from it.

‘The cap appears to be disincentivising customers from switching provider, which is a concern as switching remains a reliable way for households to save money on their energy bills and lock in an energy tariff that is significantly lower than the £1,042 cap level.

‘With the economic environment still highly uncertain, switching to a fixed-rate tariff is an effective way for people to lower their energy bills during the coming colder months.’  

Could you cut your energy bills… or help the planet and go green? 

Millions of people could be needlessly overpaying for their energy as they fail to switch to providers who offer cheaper deal.

They may also be missing out on the opportunity to help the planet and fight climate change, by switching to green deals that offer electricity from renewable sources and more environmentally-friendly gas.

With our partner, Compare the Market, you can compare energy tariffs and exclusive deals.

Why not find out if you could save hundreds of pounds a year on your energy or go green?

>> Check to see if you can start saving money now

This post first appeared on dailymail.co.uk

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Hope for first-time buyers as YBS launches 90% mortgages

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hope for first time buyers as ybs launches 90 mortgages

First-time buyers squeezed by the mortgage crunch have been given another ray of hope as Yorkshire Building Society launches home loans for borrowers with a 10 per cent deposit. 

The move from one of Britain’s biggest building societies is better news for borrowers who have seen nine in ten of the mortgages for those with a 10 per cent deposit available in March wiped off the market – leaving just 71 deals from a handful of lenders.

But with a 3.69 per cent two-year fixed rate and 3.79 per cent five-year fixed rate, the YBS deals will cost borrowers considerably more than what’s on offer to those with bigger deposits.

Yorkshire Building Society is one of the few lenders to offer a 90% LTV deal for first-time buyers and those looking to remortgage currently

Yorkshire Building Society is one of the few lenders to offer a 90% LTV deal for first-time buyers and those looking to remortgage currently

Yorkshire Building Society is one of the few lenders to offer a 90% LTV deal for first-time buyers and those looking to remortgage currently

Two-year fixed rates are on offer below 1.3 per cent and five-year fixes below 1.5 per cent for those with buying with 40 per cent deposits. 

The YBS deals are aimed at first-time buyers and existing homeowners with less equirt who want to move house or remortgage.

Banks and building societies slashed high loan-to-value mortgages after the Covid-19 pandemic and lockdown hit. 

Many blamed the volume of demand for mortgage holidays, combined with staff working at home, but they are also concerned about negative equity if house prices fall and job losses that could see borrowers struggle to pay their mortgage.

Ben Merritt, senior mortgage manager at Yorkshire Building Society said: ‘We’re committed to supporting borrowers with smaller deposits and are really pleased to offer these mortgages again – there’s certainly been a gap in this part of the market for some months.

‘Thanks to the hard work of our front line colleagues we now feel we’re in a better position to continue supporting existing borrowers who need a payment holiday and launch mortgages for new customers, while maintaining the high standard of service our customers expect.’

Is YBS’s mortgage a good deal?

YBS is offering a 3.69 per cent two-year fixed rate with a £995 product fee for home purchases and remortgages. 

What about the self-employed?

The self-employed do qualify for YBS’ 90 per cent product – even if they’ve been granted support by the government.

Merritt says: ‘Yes, we continue to accept applications from self-employed customers who have taken government support. 

‘We may however, need to request additional documents to confirm the income is sustainable for an applicant’s individual circumstances.’

It also offers a 3.79 per cent five-year fixed rate with a £995 product fee for home purchases and remortgages. 

All its house purchase mortgages come with a free standard valuation, and those looking to remortgage get paid legal fees.

But the rate is not the lowest out there though. 

Rachel Springall, finance expert at Moneyfacts, says: ‘These are competitively priced and may well attract borrowers looking to save on the upfront cost of their deal as they come with a free valuation and allow borrowers to add the product fee to the mortgage advance.

‘For first-time buyers there are alternative deals to consider in the market such as Nationwide, of which their two-year fixed is priced at 3.49 per cent and their five-year at 3.54 per cent both with free valuation and £500 cashback incentive.’

The Yorkshire’s intermediary arm, Accord Mortgages, also offers a range of 90 per cent LTV mortgages.

Ben Merritt, of Yorkshire Building Society says the lender can continue supporting existing borrowers and offer new deals

Ben Merritt, of Yorkshire Building Society says the lender can continue supporting existing borrowers and offer new deals

Ben Merritt, of Yorkshire Building Society says the lender can continue supporting existing borrowers and offer new deals

David Hollingworth of L&C Mortgages says: ‘Other lenders like Nationwide, Metro Bank, Platform and Virgin Money are some of the other lenders that currently offer 90 per cent deals and others have dipped in and out with products when possible. Atom Bank has just launched some rates today.’

Borrowers considering a 90 per cent mortgage will pay much more than before the pandemic.

Mark Harris, chief executive of mortgage broker SPF Private Clients, says: ‘Sadly, the lack of availability means borrowers have seen high LTV rates rise. 

‘Twelve months ago, 90 per cent two-year fixes were available from less than two per cent but now the equivalent products cost well over three per cent, despite rock-bottom interest rates.’

Those considering waiting for a better deal or more options may have to wait a bit, although things have improved slightly.

Since March 701 of the available 90 per cent LTV products have been axed – leaving just 78 on the market – a slight increase from the 56 available at the beginning of the month. 

Twelve months ago, 90 per cent two-year fixes were available from less than 2 per cent but now the equivalent products cost well over  3 per cent 

But even though more lenders are willing to put their toe in the water, Springall believes that the return of the 90 per cent deals will be a gradual process.

She says: ‘It’s a great sign when you have the likes of YBS coming on and available to everyone but building societies are very different to banks.

‘It will take time for other lenders to follow their lead. That’s why we’ll see certain lenders like Atom Bank offering to just first-time borrowers and buyers and then if this works they will have deals available to those that want to remortage.’

Figures from Moneyfacts highlight the few options borrowers have to choose from if they have smaller deposits, with mortgages above 90% hacked back

Figures from Moneyfacts highlight the few options borrowers have to choose from if they have smaller deposits, with mortgages above 90% hacked back

Figures from Moneyfacts highlight the few options borrowers have to choose from if they have smaller deposits, with mortgages above 90% hacked back

Will the mortgage remain on the market?

This year has seen a few 90 per cent LTV lenders enter the market only for those offers to disappear following hype and an influx of applications.

YBS’s product is likely to be a popular offering given its competitive rate. 

Merritt says there’s no current restriction on the number of applicants the building society is willing to take on.

He explains: ‘We don’t have a set threshold for these products, but we will continue to monitor our service levels to ensure we continue to offer the high levels of service our customers expect.’

YBS says it’s able to offer qualifying customers a mortgage in 15 days, which means that borrowers will be able to take advantage of the stamp duty holiday.

Merritt says: ‘There are still a number of months to go before the stamp duty holiday deadline. 

‘On average we provide customers with a mortgage offer in less than 15 days, but of course there are a number of factors involved with the wider house buying process that could affect completion timescales, out of our control.’

What type of homes can I buy?

There are some types of properties that Yorkshire Building Society won’t lend on. These include:

· Pre-cast re-enforced concrete properties, designated under the Housing Act 1985, unless they have been repaired by PRC Homes Ltd, a subsidiary of the NHBC.

· Local Authority multi-storey blocks

· Dwellings constructed by timber, i.e., not clad with brick, stone etc, including  log cabin/chalet type of construction

· Single brick (single skin) construction

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Bitcoin price: Why has it fallen 12.5% in a day?

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Bitcoin’s seemingly unstoppable surge towards an all-time high and a $20,000 price tag went into reverse as holders tried to cash in their gains for a profit.

The price of the cryptocurrency plummeted more than 12 per cent over the last 24 hours from a peak of $19,374 a coin on Wednesday to $16,858, according to figures from Coindesk.

Fellow cryptocurrencies like ethereum and ripple have also plunged in price over the last 24 hours, while bitcoin’s fall was its sharpest since the start of September.

Bitcoin plunged by more than 12% in the last 24 hours just as it looked set to hit an all-time high

Bitcoin plunged by more than 12% in the last 24 hours just as it looked set to hit an all-time high

Bitcoin plunged by more than 12% in the last 24 hours just as it looked set to hit an all-time high

It had looked set to break its all-time high of around $19,500, set in December 2017, driven by a series of good news stories, endorsements from institutional investors and continued money printing by central banks. 

The fact the price of the cryptocurrency had risen from just under $8,000 in January to the verge of $20,000 a coin without serious interest from casual investors had led some to argue the boom this time around was here to stay for a while yet.

This is Money has previously reported on the factors driving the cryptocurrency’s rise, including endorsements by the likes of PayPal and JP Morgan, which said it could possibly compete with gold as an alternative store of value. 

However, this positivity has been somewhat dented by the sudden plunge in the bitcoin price, which appeared to be the result of a massive sell-off by high net worth holders of the cryptocurrency.

The sharp drop is yet more proof of the cryptocurrency’s volatility and why This is Money warns casual investors looking to buy into it that they need to do their research and be careful beforehand.

According to bitcoin analysts Glassnode, the number of investors holding at least 1,000 bitcoin reached an all-time high this week, with the concentration of large sums of the cryptocurrency in the hands of a small number of investors giving them a significant influence on the market.

Another analyst, Ki Young Ju, wrote on the social media platform Twitter that these holders of large sums of bitcoin had sold off their holdings, causing the price to fall.

Bitcoin has been on a tear since the end of the summer and is still massively up on where it was at the start of this year

Bitcoin has been on a tear since the end of the summer and is still massively up on where it was at the start of this year

Bitcoin has been on a tear since the end of the summer and is still massively up on where it was at the start of this year 

And one of the most well-known cryptocurrency exchanges, Coinbase, said traders were being hit by connectivity issues as they tried to make purchases or sell-off their holdings. The San Francisco-based exchange said it had found and fixed the problem.

Responding to the sudden drop, Glen Goodman, the author of the book The Crypto Trader, said: ‘When Bitcoin approached $20,000 in 2017, more people were queueing up to buy it than ever before.

‘Many of those buyers have been holding their investment – in varying degrees of misery – ever since.

‘The pressure now, not least from their long-suffering partners, is to sell and finally break even on their investments.

‘With their fingers hovering over the “sell” button, when the price started retreating slowly down to $19,000 and then $18,500, it led to a flurry of panic sellers grabbing their chance to break even, and those sellers caused the price to crash fast.’

However, he still said the long-term picture for the cryptocurrency was ‘very positive’, despite the possibility of ‘a lot more price volatility in the near future’.

He added: ‘This appears so far to be a healthy correction in a big bull market. In my opinion, only a fall to $10,000 would put that bullish narrative in question.’

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Just FOUR councils applied to use a new hedgehog warning road sign

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A new traffic sign launched by the Department for Transport for councils to display on roads with high populations of hedgehogs, badgers, otters and other small animals has received a prickly response with just one per cent of authorities applying to use it.

The sign, unveiled last year, displays one of the spiky creatures in a red warning triangle and was designed to help preserve dwindling hedgehog numbers and reduce the number of people injured in collisions involving animals.

However, This is Money can exclusively reveal that all four councils who did apply to erect the signs were denied permission because they did not provide enough evidence to the DfT that they have a high concentration of the animals in their areas.

Prickly reaction: Just four councils have applied to the Department for Transport to use a hedgehog warning sign on roads that put the animals and drivers and riders at risk

Prickly reaction: Just four councils have applied to the Department for Transport to use a hedgehog warning sign on roads that put the animals and drivers and riders at risk

Prickly reaction: Just four councils have applied to the Department for Transport to use a hedgehog warning sign on roads that put the animals and drivers and riders at risk

Of the 343 councils that could have requested to display the signs on their roads, only Newcastle City Council, Middlesbrough Council, Surrey County Council and East Riding of Yorkshire Council applied, according to an Freedom of Information request by the AA.

All four subsequently had their applications denied, the DfT confirmed.

The department clarified that all four had ‘failed to evidence any concentrations of small animals habitually in the road, or provide any accident data’.

Councils and animal conservationists will query how they can feasibly provide evidence of hedgehogs being at risk on their roads. 

‘Rejection of the applications based on failing to provide adequate evidence conjures up all sorts of weird scenarios: council officers counting the bodies or sending off the evidence in jiffy bags,’ said an AA spokesman. 

He added: ‘Common sense suggests that, if cash-strapped councils are prepared to fork out the money for the signs and the manpower to erect them, there is probably the local need for them.’

The signs are to warn of small animals, including hedgehogs, badgers, otters and squirrels. Hedgehogs in particular are now on the Red List of endangered UK species

The signs are to warn of small animals, including hedgehogs, badgers, otters and squirrels. Hedgehogs in particular are now on the Red List of endangered UK species

The signs are to warn of small animals, including hedgehogs, badgers, otters and squirrels. Hedgehogs in particular are now on the Red List of endangered UK species

The decision to deny these authorities will has left the British Hedgehog Preservation Society bristling in frustration.

Hedgehog numbers have plummeted in recent years, halving in volume since 2000.

The animals now find themselves on the Red List of endangered UK species.  

Fay Vass, chief executive at the British Hedgehog Preservation Society, told This is Money: ‘We are disappointed that more authorities aren’t applying for the small mammal signs that feature a hedgehog and that the DfT are rejecting those that do. 

‘We know from interaction with the public that these signs would be very welcome in many areas where hedgehog road casualty counts are high. 

‘In the meantime, we produce a sign that can be purchased for display on private property, but we very much hope that the official signs will soon begin to be erected in the spirit they were intended. 

‘They are important to warn people that small animals might be on the road in that area, not only for the sake of the animal, but to help reduce risk for drivers too.’

The AA asked how councils could feasibly provide evidence that they have roads with high concentrations of small animals

The AA asked how councils could feasibly provide evidence that they have roads with high concentrations of small animals

The AA asked how councils could feasibly provide evidence that they have roads with high concentrations of small animals

The new traffic warning sign was launched in 2019 by former transport secretary Chris Grayling, including a bespoke announcement and plenty of fanfare around the sign. 

It was unveiled as the DfT said hundreds of people are injured every year in collisions involving animals in the road, claiming that 629 people were injured in accidents involving an animal in the road (excluding horses) and 4 people were killed in 2017 alone. 

Mr Grayling called on local authorities and animal welfare groups to identify accident and wildlife hotspots where the sign should be located.  

He said: ‘The new small mammal warning sign should help to reduce the number of people killed and injured, as well as helping our precious small wild mammal population to flourish.’ 

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