Energy firm says bills may be cut early next year

One of the UK’s major energy suppliers has recently stated that it may be looking at cutting energy usage costs early next year if wholesale energy prices continue to fall. The price of crude oil fell earlier this year, and energy firms were slated by consumer campaign groups and officials by not responding to the drop in oil prices by cutting bills, but the energy firms said that the reason behind this was that the cost of wholesale energy was still high. Read more

Tags: bill, cut, wholesale energy prices, Mayo, Energy crisis, watchdog, step

Energy bills need to fall in line with oil prices

Officials from a consumer watchdog group have become involved in a row over energy prices, after insisting that the price of energy usage needs to be falling in line with crude oil prices. Since the summer the price of a barrel of crude oil has plummeted by around 50%, but energy prices have gone up twice this year and not come back down. Energy giants have said that the price of wholesale energy is still high, hence the price of usage has not come down. Read more

Tags: Minister Mike O'Brien, government, July, result, watchdog

Massive fine for insurance broker over cancelled policies

A well known insurance company has been accused of treating customers unfairly, and as a result has been fined £735,000 by the Financial Services Authority, the UK’s financial regulatory body. The insurance firm, Hastings Insurance Services Ltd, was found to have cancelled the policies of customers after finding that the cover had been sold to the customers too cheaply due to a computer error. Read more

Tags: insurance firm, finance, Insurance, error, Hastings Insurance Services Ltd, industry watchdog

100% mortgage customers should watch out for negative equity

Over recent years the number of 100% mortgages being taken out has risen, with fewer and fewer first time buyers able to afford to raise the deposit to purchase a property because of the cost of properties in the UK at present. Many lenders will not offer 100% mortgages to applicants because of the risks involved, but there are still many lenders that do offer 100% mortgages to first time buyers, and many first time buyers have taken these to enable them to purchase a property without the need to have a deposit available.

However, some experts have warned that consumers that are now thinking of taking out a 100% mortgage need to consider the risk of falling into negative equity. House prices in the UK have already fallen unexpectedly in September 2007, and experts have warned that the fall in property values could continue over the course of the year. This means that those taking out 100% mortgages now could soon find that they are actually in negative equity if house prices do continue to fall as predicted.

One industry professional stated: ‘There are indications that the house price boom is slowing, so anyone taking out a 100% mortgage is risking being stuck in negative equity. And if you add hefty fees to your mortgage, the risk is increased.’ Negative equity is where you end up owing more on your property than the actual value of the property.

In the past six months alone the number of 100% mortgage deals has increased from 92 to 160. Many of those that have recently taken out 100% mortgages may already have found that they are slipping into negative equity following the September 2007 price fall.

Recent Additions:

• Homeowners are not as well off as tenants
• Increasing number of first time buyers look to brokers for assistance
• Gazundering becoming more commonplace
• Unions angry over insurance job cuts
• Watchdog to probe sale and rent back

Tags: first time buyer, time buyers, experts, watchdog, year, 100% mortgage, boom, hefty fees

Consumers are unlikely to switch accounts unless “they suffer”

Despite an awareness of the benefits of switching bank accounts, consumers are reluctant to take advantage of what this move will bring, one financial expert has claimed.

According to moneysupermarket.com, the majority of providers in the UK want consumers to come in on a service proposition, not a price proposition.

This tends to be a less tangible, lightweight offer to spenders as it merely says ‘we have better services’, said the financial advisers.

Kevin Mountford, head of savings and current accounts at Moneysupermarket.com, said that there is an awareness of the benefits of moving accounts.

“However, it does not seem that people have the impetus or the appetite to do so unless they suffer and gets a poor service from their provider,” he continued.

Of those surveyed by the Watchdog, 46.8 per cent did not think they should be charged for going over their overdraft limit without authorisation, while 28.2 per cent felt that it was difficult to get a complaint with their bank resolved.

Tags: service, watchdog, Driving, overdraft, bank, service proposition

Credit card companies make up for lost charges

Credit card companies are increasing charges, rates and fees in order to prop up their profits after a government watchdog forced them to cut penalties for exceeding credit limits.

In 2006, the Office of Fair Trading (OFT) ruled that companies could only recoup the costs they incurred by card holders going over credit limits or making late payments.

Previously, charges for such minor failings had been met with hefty fines of £25 or more, but the OFT ruling forced the industry to cut charges by around 50 per cent.

However, personal finance analyst Defaqto has claimed that the credit card companies are making up for this lost source of revenue by other means.

“Credit-card providers have lost a great deal of highly profitable revenue because of the charges cap and will inevitably seek ways to replace their lost income,” principal banking consultant David Black warned.

Amongst the new kinds of charge credit card firms are levying are charges for under-use of cards and for failure to notify them of a change of address. At the same time, familiar old fees have been boosted.

Tags: Amongst, UK default charges controversy, consultant, watchdog, business, credit card firms, cards, card holders