Sarah Pennells is a personal finance journalist and the face behind SavvyWoman.co.uk. We think she does a great job at explaining financial subjects in a very clear and accessible manner. You can find her column below where she writes about the latest financial news, and helps you get more from your money.
Home buying to be less stressful…perhaps
Have you ever been gazumped? Or have you been the one doing the gazumping? If you’ve been looking for property in an area where there’s a lot more demand than supply, then you may have been gazumped in the past.
Gazumping is where you put in an offer for a property that’s accepted by the seller, but they later accept a higher offer. In England and Wales there’s no legally binding agreement between the buyer and seller until contracts have been exchanged, which is normally only a few weeks before you move in. So, there’s a period of – often several months (especially if there’s a chain) – where the seller – and buyer – can change their mind and there’s nothing the other can do about it.
At the moment, a quarter of sales fall through, which can mean money wasted on property surveys and mortgage application fees, not to mention solicitor’s fees. The government wants to speed up the process and reduce the number of sales that fall through and it’s launched a consultation into the way homes are bought and sold in England and Wales. But, even if the government decides it wants to make some fairly major changes, they wouldn’t come into effect for some time.
SAVVY TIP: The government is considering lock-in agreements, which would mean that once a seller has accepted your offer, they can’t sell it to someone else for a fixed period.
If you’re thinking of buying a property, here are my tips for reducing the chance of the purchase falling through:
- Get hold of your credit report if you’ve never seen it or not checked it recently. Make sure there are no ‘nasties’ on there (such as debt problems, defaults or missed payments). If you have been late with or missed payments, consider adding a notice of correction to explain why this happened.
- Talk to a mortgage broker or lender before you start looking so you know roughly how much you’d be able to borrow. If you go to a mortgage broker, they should also tell you which lenders have a fast turnaround on mortgage applications. Some can drag their heels!
- If you’re on a tight budget when it comes to the costs of buying, look for a mortgage deal where there’s no fee or no fee to pay until you complete (move in). That way, if the sale falls through, you won’t be so out of pocket.
- Make sure you tell the mortgage broker or lender about anything that could be a problem with your application, such as if you have had debt problems etc. They will find out and it’s better for them to hear it from you than from their own checks.
- Make it a condition of your offer on a home that the estate agent stops advertising the property and marks it as ‘sold subject to contract’.
Booked a hotel? Got a good deal?
I don’t know about you but much as I love travelling, booking a holiday can be quite stressful. You’re usually faced with lots of choice, but there’s always the uneasy feeling that you’re not getting the best deal (or is that just me?!).
Now hotel booking websites are to be investigated by the Competition and Markets Authority. It’s concerned that these sites may be skewing search results based on the commission they receive, exaggerating the discount you’re getting, adding in extra charges at the last minute or putting customers under pressure to buy based on the number of people viewing a particular room or the number who’ve already booked it.
My advice? I normally check the price direct with the hotel, as well as via a booking site. Sometimes you get a better deal that way!
Fancy a new job? Watch out, it could be a fraud!
There’s a new twist on the eBay/online marketplace selling scam, where fraudsters are recruiting others to do the scam for them, by advertising non-existent jobs. Action Fraud is warning that it’s seen an increase in the number of fake sales jobs being advertised.
The fraud works like this: a fake job is advertised on a job website and the fraudster explains that it will be a sales job, selling items for a company. Unusually, job applicants are told they must use their own bank account and online selling account (there’s normally a plausible sounding reason as to why this is).
The jobseeker is then given photos etc of the items they’re supposedly selling and told to list the item. The victims who ‘buy’ the goods think they’re making payment into a safe third-party account, but they’re not. So, they lose out, and the jobseeker doesn’t get paid for the sale.
Action Fraud has also seen an increase in the number of fake modelling jobs, where people are pressured to pay an upfront fee to secure modelling work. Except there is no modelling work and it’s just a way of extracting money from unsuspecting victims.
Bank switching at a new low – but should you switch?
Have you switched your bank account? The chances are the answer is ‘no’, as most people are very loyal to their bank, even if they don’t particularly like it!
Figures out for September show that fewer than 58,000 people switched current account provider – the lowest number since seven day switching was launched four years ago.
But, if you’re not happy with your bank’s service, or if you think you could get a better deal elsewhere, there are several banks offering a cash incentive if you switch. As I write this, the most you can get is £250.
You normally have to register for online banking, pay in a minimum amount and set up a couple of direct debits, to get the cashback. And you may have to pay it back if you close your account shortly after pocketing it – so check the details.
Should you get a smart meter?
If you don’t already have a smart meter from your energy supplier, you’ll probably be offered one in the next couple of years, as smart meters are being installed in homes in the UK between now and 2020. Smart meters are designed to send regular readings of your gas and electricity use direct to your energy supplier, without you having to do anything.
This means you will only pay for the energy you use and shouldn’t pay too little – or too much – based on estimated bills. Smart meters are also meant to help you reduce your energy bills by showing you what you’re using.
But not everyone’s enthusiastic about them. Critics say that they don’t deliver lower bills as promised, current smart meters may not work fully if you switch energy supplier and they’re not always reliable if you’re in an area where there’s a poor mobile signal or if your property has very thick walls!
SAVVY TIP: You don’t have to pay for a smart meter or to have it installed. The cost is being added on to all our bills – whether or not you have a smart meter. You can refuse to have a smart meter and your energy supplier shouldn’t put you under pressure to have one.