Mortgage Rates and Banknotes

Hello, welcome to this Money Box Podcast. The charity Victim Support criticises a new government fraud strategy for failing to set a target for fraud reduction. Banks say they'll keep the contactless card payment limit of a hundred pounds, even though new rules mean they could raise or scrap it. And what animals would Springwatch presenter Chris Packham like to see on the new Bank of England notes? But first,

Financial waves from foreign wars continue to hit our shores. On Wednesday, average mortgage rates offered by lenders increased to more than five percent for both two and five year fixed rate deals. It's the highest since last summer, when rates began to ease downwards on expectations of further cuts in bank rate. Those expectations are now on hold.

Just two weeks ago a small cut was widely expected next Thursday, when the Bank of England makes its latest announcement, but that's now seen as very unlikely, on fears of rising inflation. and even the Chancellor admits prices are likely to rise, as oil, gas, petrol, and diesel remain well above their levels of two weeks ago.

Mortgage rate rises of course are bad news for the nearly two million people who will have to remortgage this year when their fixed rate deal ends, and of course for all those hoping to buy their first home in twenty twenty six. Ashley fixed her mortgage last week, after worrying over rate rises. We were due to renew we can't renew with um our current lender until three months before, which we were more than happy to do. It seems like overnight or very, very fast things change.

So we've had to look at other lenders within the space of a couple of days. Had to kind of jump before we would have liked. Currently we're on five point three two. We're looking at sort of late threes. And luckily with our mortgage advisor we have managed to lock that in. My advisors just text me to say that our current lend has actually gone up 0.5%. Glad that we pushed the button last week because this is obviously increasing really, really fast now.

Ashley, just in time there. Well, let's go first to talk to Adam French from the financial data company Moneyfax. Adam French, you've been checking rates for us this morning. Where are they now? Yeah, we've uh we've way past uh five percent now, unfortunately. Uh the average two year fix stands at five point two percent this morning.

And the average five year six at five point two five, which is the highest it's been since February twenty twenty five. So in the space of just over a week we have more or less lost And what about sub four percent? I mean, Ashley just sneaked in there. I think she got three point nine seven percent on her five year fix. Any sub four's still there?

There are still a handful, but they are dwindling quite quickly. Um at the start of March the the lowest rate we had on was three and a half percent. Um now there is there was one available yesterday at three point seven eight. Now you said earlier this week that Monday was one of the most turbulent days in the mortgage market for almost four years. Hundreds withdrawn. What's the latest on that?

Yeah, the numbers have gone up unsurprisingly as as the week has gone on. We've now lost around ten percent of the available market from where we started the week, so around seven hundred products have been withdrawn. Um but to put that into context, that is still nowhere near as bad as we saw around the aftermath of the mini budget when we actually lost twenty five percent of the budget in a single day at one point with very busy days for withdrawals around that. So it's bad, but it could be

That was the famous min Liz Trust mini budget in September twenty two, of course. Um stay with us, Adam, but with me in the London studio is Jane King. She's an independent mortgage advisor at the firm Ash Ridge. Um Jane King, I suppose I should ask you first actually, uh is this the worst you've seen in I believe you've been doing this job for twenty five years, l as I have.

Yes, well there's a lot of very anxious people out there. Um it is probably the first time since the mini budget that there's been so much anxiety amongst people that have got their rate. Um not ready to f to switch yet but can see it on the horizon in the next six months or so. So what are clients saying to you, what kind of impact is it having on the decisions they make or what they might be going to do?

It seems to me that the people that have already got mortgages are more anxious than those that are yet to step on the ladder. Uh first-time buyers at the moment are pretty relaxed about it, but that's not to say if This carries on that they there will be a level when they say actually no. But those that have already got mortgages are extremely anxious because they can't see an end to it.

No, and of course people like Ashley, she's actually um benefiting from this because she was on five point three two and now she's on a shade under four. So it'll be good for some people, but others who fixed earlier are on one or two or three percent, they're they're going to be paying a lot more.

Well those that ha were forced to fix during the mini budget, you know, they're obviously seeing uh much reduced rates, but those as you say that are coming off one one point five, but I think the problem is is that people that are still got six months to go, seven, eight months to go that can't see an end to this are the ones that are the most anxious. Yes, I mean I remember not too long ago you could actually book a mortgage six months ahead, but I think that's changed now, hasn't it?

During COVID it was six months. Now most lenders won't release follow on rates until three to four months before your rate expires. So anyone, you know, towards the end of the year, August onwards, are stuck uh playing a bit of a waiting game, I'm afraid. Yes. So so they've got yeah, they've they c don't quite know how it'll be. Um

Five year fix, as she chose, rather than a two. Is that something that people are moving towards?'Cause they want that certainty because who knows what'll happen in five years time.

I think this will force a lot of people to consider whether peace of mind is more important than rate and maybe pay a little bit more for a five year for for knowing, you know, exactly what their Budget is gonna be over the next five years, especially as they've got other expenses such as fuel and food and all the rest of the year.

Yes, if you look back over five years, a lot of things have happened, haven't they? I'm sure they will in the future. Now the Bank of England will meet on Thursday to make its latest decision on the bank rate. Uh last time five members voted to hold. Four members voted for a cut. Now we expected maybe a cut, but this has changed everything. What do you expect on Thursday? expect them to hold it. I don't think they want to yo yo up and down so hold this month, take a view next month.

Adam French from Money Facts. Rising or steady bank rate also affects savings. Just very briefly, what are you seeing on savings?

Savings rates at the moment are holding pretty steady. They're not falling uh as we expected. Actually ISA rates have upticked a little bit given it's ISA season and they're competing quite hard. So I think they're The upside to bank rate holding for there's many more savers than there are mortgage holders as well, so it could be good news for quite a few people with cash in the bank.

Indeed, but we're not seeing them rising, it's just that they're less likely to fall as we were perhaps expecting. Um and and Jane, someone listening who's worried about their own mortgage, perhaps the first time buyer or indeed they've got one of these fixes you say is is worrying people more'cause they can see the end date for that. What's your best advice to them? What should they do practically?

If you've got a remortgage or if you've got a fixed rate that's not expiring for at least three or four months, there is very little you can do except maybe overpay so that when you do go to remortgage the amount that you owe is less and maybe you'll get a better rate that way. First time buyers, look at your budget. You know what you can borrow, you know what your monthly outlay is. If it gets too much, then maybe put it on the back boiler for a while.

And is it important very briefly to be a good borrower to to make sure your bank statement shows you're sensible with your money and you've got that affordable cash? Does that get you a better rate? It doesn't necessarily get you a better rate, but the bigger deposit you can save, the better the rate will be.

Right. So hi mum, I'm saving for a deposit is the best advice. Absolutely. And of course you should always find good independent mortgage brokers. Uh Jane King and Adam French, thank you very much. And still with the impact of the war, news this morning that the Chancellor is to offer support to households struggling with higher heating oil costs, which have more than doubled in two weeks.

We discussed this last week on the programme. In an interview with the Times, Rachel Reeves says she has, quote, found the money to help and quote, will give greater support to those who really need it. Our reporter Dan Whitworth has been looking at heating oil prices. Dan doubled, but just what are the actual figures? Okay, well they've gone up from around an average of sixty P a litre to one hundred and twenty-nine P today, and liquid petroleum gas prices are also up. Now this affects

More than two million households in the UK who use heating oil, but unlike gas and electricity, prices are not capped. No details yet on how much support will be given or what those who really need it means. Uh details of the new scheme expected in the next few days, Paul. We hope to bring you those next week. And this came, of course, Dan, after the Chancellor and the Energy Secretary met with petrol retailers in Downing Street with a clear message very strongly expressed

Don't take advantage of the water, rip off your customers. Now the Petrol Retailers Association was upset by that, rejected suggestions of what it called price gouging. And what's actually been happening to prices at the pump, Dan? Well, the latest figures from the RAC on Friday show that average petrol prices have risen to nearly one hundred forty one P a liter this week. That's up almost eight pence since the war began. Diesel's risen more sharply, climbing nearly seventeen pence a literal.

to just over one hundred and fifty nine p a litre. Now drivers can compare the cost of fuel offered by all petrol stations across the UK. That's part of a government scheme called Thanks Dan. Good tip there.

Now victims charities have criticized a long awaited and much delayed fraud strategy report published earlier this week by the government. It sets out how ministers plan to tackle the most common crime in the UK fraud. The Home Office says fraud costs the economy fourteen billion pounds a year, and each year millions of people and businesses are robbed through increasingly sophisticated techniques by increasingly ruthless criminals.

They leave many victims not just financially ruined, but emotionally devastated, as these Moneybots listeners have told us. Yn ychwanegu. Yn ychwanegu. Yn ychwanegu. Yn ychwanegu. Yn ychwanegu. Ychwanegu. You go through every emotion conceivable about how could I have been so stupid? Is it just me? Why had I not done something about it sooner? Where do I go from here? I I just felt embarrassed about the whole thing, you know.

And I think this is what happens to most people. They feel what is a private thing and they don't want to discuss it. So that works in the scammer's favour. Rydyn ni'n gallu ddysgu'n ddysgu'n ddysgu'n ddysgu'n ddysgu'n ddysgu'n ddysgu'n ddysgu'n ddysgu'n ddysgu'n ddysgu Well victims charities have told this program not enough emphasis is being put on how to help people like

Sarah, Bryant and Joan, who you heard there. And Dan Whitworth's not just been at garages this week, he's been speaking to victim groups and reading that report. Dan, we've seen previous strategies. How significant is this one? Uh this is a major bookmark, uh a major moment in the fight against fraud, Paul. Um now you'll remember this is the first time this government has actually set out in detail

uh its plan to tackle fraud. And remember it's nearly two years into governing. Um so we have the plans to tackle fraud. It's a ninety three page document and the government would say it's bringing the fight against fraud right up to date. Yes, but what are the key new points for you? Okay, well the report is subtitled Disrupting Crime, Supporting Economic Resilience and Delivering Justice.

Uh so as you say some of the key points 250 million pounds invested is part of this fight for the next three years. That's up to 2029, of course, the end of this. current parliament. Uh some s key plans in there to tackle overseas scam compounds. That's essentially where serious organised crime groups, they're really turning this into a sort of industrial level scale scammers and fraud systems.

Uh it wants to unite or bring together different stakeholders as part of a new online crime centre.£31 million of funding for that. That'll bring together uh organizations like the police, intelligence services, big tech, the banks. Really to try to share intelligence and stop fraud before it starts. Now, as from next year, there'll be national standards to help victims and also targeted support that'll be rolled out to fraud hotspots right across the UK.

Well it all sounds good, Dan. What's the reaction been like to it though? Well, uh I mean the press release it had lots of very supportive quotes on it. Um more yeah, I'm sure more more than a dozen. Uh and they were from, you know, serious players in the fight against fraud. The the UK's one of the most y uh most senior law enforcement officers, the director general of the national crime agency, uh the National Police Chiefs Council, lead for economic crime.

obviously again very supportive. Then you've got people like the regulator, the financial conduct authority, prosecutors, phone, broadband companies, again all welcoming this new strategy, talking about tackling fraud together. Cross sector collaboration, phrases like that. And then big tech and some of the biggest uh of the big tech companies. Meta talks about sharing intelligence, strengthening partnerships, collaboration, and again things like Google, banks, industry, all very much on board.

Yes, and we've heard a lot of that before though, haven't we? Collaboration and all this kind of thing. But all those people are are involved in dealing with it. But what about the victims? I didn't hear you mention victims or consumer groups. No, I'm not. Uh there were no quotes uh from that press release uh from uh victims or consumer groups. So essentially this week I've been finding myself calling round some of those.

consumer champions and victims groups to find out what they make of it. And broadly speaking, Paul, they are much more critical, much more cautious in their welcome of this strategy. I've got a couple of quotes I want to read for you. Victim Support Scotland says While we welcome the spotlight on this type of crime, the strategy itself offers little detail on how victims will be supported. This is especially concerning given the significant emotional and financial impact we know.

Fraud has on people. Victim support for England and Wales, meanwhile, Paul. Well, it told me, quote, We welcome many of the measures that have been set out. However, the strategy falls short in its ambition to strengthen support for those affected. Which says the most effective way to disrupt fraudsters would be to make tech giants take responsibility and stop a flood of scams from appearing on their platforms. It says this fraud strategy fails to do that.

And of course the most important thing for victims then is to make sure there are fewer in the future. Now the previous reports had a target for reducing fraud by ten percent. You and I have reported that it certainly didn't do that. What's the target in this strategy? Very brief. Well well victim support says again, no clear measurable targets in this report and obviously that me makes it difficult to measure success. It makes it difficult to hold the government to account.

So the true test, of course, with all these things, Paul, is the test of time. So we will be watching closely the next six months, the next 12 months, and of course, we'll keep people informed about how it goes. We absolutely will. Thanks very much, Dan.

Now a question we don't usually ask on money boxes. What's your favourite animal? This week the Bank of England announced it would follow the public's preference in a survey it did last summer, and replace historical figures with nature on the next series of Bank of England banknotes. We asked Spring Watch presenter Chris Packham what he'd like to see. I obviously love the idea of putting wildlife on the water.

banknotes it would give a fantastic opportunity for everyone who's handling that currency. So that's obviously people who live here in the UK but also everyone who visits too to engage with our wildlife. But the one thing that strikes me is that we shouldn't forsake this opportunity to draw attention to the fact that

of our wildlife is in a lot of trouble. We are one of the most nature depleted set of nations on the planet. Our biodiversity is struggling. So whilst it would be tempting to put the nation's favourite our wildlife icons, the red squirrel, the barn owl, onto those notes. I would like to see those species which are equally beautiful but are struggling. So maybe it should be the lap wing, maybe it should be the fox, not a species that's rare,

But a species which divides opinion and therefore promotes conversation about the way that we look after our wildlife. And we shouldn't forget, you know, that the the the little guys the underdogs as well, which play an equally important part in our ecology. So some of our rarer butterflies, those that have been in significant decline recently, it would be great to see those on there as well.

Oh Chris Packham. So tell us your favourite animal for the new banknotes, before they become an endangered species too, of course. Email us now at moneybox at bbc.co dot uk or send us a voice note as Christian WhatsApp O Double Three O six seven eight three one eight three. A few coming in already, and of course concerns about heating costs too. Now on Thursday the hundred pound cap on contactless card payments in the UK is being scrapped.

Well, the Financial Conduct Authority is giving the banks the freedom to set their own limit. In theory they could remove the cap altogether, but turns out as far as we can tell, not a single bank or credit card provider plans to raise, never mind scrap, the hundred pound limit. Sticking with what Bumbank told us was the industry consensus. A reporter, Bissi Adabeo, asked people in Oldham if they thought the hundred pound limit should be raised. I think it should be kept.

Spent anything, couldn't they? If your card got stolen. I heard that you can only pay a certain limit of a hundred pounds to pay contactless for your car payment but I feel like that's really like rude because some people just wanna pay more than uh just a hundred pound and just go over the limit and they should just be able to. So you happy for the limits to be removed? Yeah I would like the r limits to be removed because yeah I'd just like to spend more than a hundred pounds

As you get older you're supposed to like manage your money well. So it gives people like opportunities to manage the overspending and I used my phone, I used my watch. I've had to stop wearing my watch because I'll just You? Yeah, I I'd like it to stay. I think they should just leave it alone. Well with me in the London studio is Ricardo Tordera. He's vice president at the Payments Association. That's the UK trade body for payment provider.

Um Ricardo Todera, those people in Oldham reflected a survey the FCA did, which found three out of four customers didn't want an increase, and nor did eight out of ten banks. I is that why they're not using this newfound freedom to cut red tape and support growth? Well, um, thank you Paul for having me and I just want to reassure our audience that listening from home that these measures are not going to impact their daily life from day one.

And that's because theoretically, yes, uh of course the regulators has um lifted this um these gaps, but for the way these gaps work, they're not going to be changed on day one. No, but when it's increased before, I we've reported on it on Moneybok obviously, it's happened almost at once, but they're not doing it this time. Why is there that difference?

So um let l let's unpack this because it can get quite technical and I think it's important to to go through step by step. So the regulator has competence on the issuers limit, right? And this is what is being changed. And this That's what the banks are allowed to do. Exactly.

But then there's also another limit, which is the one that works on the machine, so the so-called terminal limit. It has a specific name, which is the CVM. And that limit is not going to change. So technically that's sort of C Lim. But it could, couldn't it? Your members could change it, as they have done in the past. I mean when it went up to a hundred quid, it changed their own.

From ten and then it went progressively up to one hundred. So technically yes, it can change, but there is no plan of changing that. So effectively speaking, from day one the possibility is that the issuers are going to compete with themselves, which is good for the economy. It's good for competition. It also, you know, fixes the fact that if you pay with a mobile payment you do not have limits, but if you pay with a physical credit card you have limits. So it equals the consumer experience.

Uh and you know, we've seen that some people want the limit to be increased. So it just allows the possibility of doing it in the future, but nothing is gonna happen next week. No, but I mean a hundred pounds it was when it was last fixed, that that would be a hundred and twenty five pounds now. And a hundred pounds, you know, it excludes a meal out for four people usually or family a family grocery shop.

that people would like that flexibility, wouldn't they? Do you think banks will be changing this and from the technical side as well? I think yes. I think that, you know, potentially in the future when there will be enough demand, as we've seen now the demand is low, but it's good to start thinking about it and also, you know, sadly there is inflation as you said, like, you know It's it might be useful to have it increase. It's just not useful

No. So people should perhaps lobby their banks if they want it to go up. Um UK finance, which of course represents the banks, has said any money stolen with a contactless card will always be fully and quickly reimbursed, as it is now even if the limit did rise. But is that a risk your members want to protect themselves against? Because if the limit was two hundred pounds, then th it would be twice the risk of or twice the money at risk.

Well I think that what we can say about card fraud and in particular about contactless fraud. Contactless fraud is the lowest, um, in terms of numbers, is zero point one percent, something like that. So we do not see any sort of risk and also because the limits are not effectively changing from day one, there's no risk from day one for this to happen.

I also want to say that with the card system, the chargebacks are, you know, they've never been contested. It's a system of reimbursement that works very well. There are differences between the debit card and the credit card.

with the application of section seventy five or not, but also where there is no mandatory reimbursement. The the voluntary one has always been v working very well. It's never been criticised, so we never really have problems with that and people can absolutely get their money back. Ricardo Tudera of the Payments Association. Thanks.

And you can now listen to Moneybox contactlessly. Just ask your smart speaker to play BBC Radio 4, and that way you can hear it live and first. Ond, of course, as a subscriber, you will get it sent to you automatically within a couple of hours of the programme. Now you can help set our agenda by emailing moneybox at bbc.co.uk and goodness we've had a lot of suggestions about animals on banknotes.

Seymour wants the red squirrel, Penny wants the hedgehog, Stephen wants wild boar, John wants a hare, and uh Bat wants. Oh Clive, he's got a whole list here, great crested newts, and snails so small you can't even see them. Uh Julie wants the fox, as Chris Packham said. And John joined with my point. Perhaps as cash is rapidly disappearing, we should have animals which are about to become extinct.

And we've also had several on heating oil. Manda wants more details. Does it include people on LPG, liquid petroleum gas? Well, we hope to report that in the next Podcast. As I said, you can email General Points or indeed animals on banknotes to moneybox at BBC.co.uk or you can follow Chris Packham and send us a voice note. On WhatsApp O Double Three O six seven eight three one eight three. We do listen to them all and read them all, and of course you might get on the show.

Today the reporters were Dan Whitworth and Bissy Adebeo, researcher Joe Krasner, studio manager Tavey James, our editor is Jess Quail. I'm Paul Lewis and this was the BBC News Money and Work Production for BBC Sounds but Hang on, was this program actually real? I'm Jamie Bartlett, and for BBC Radio 4, I'll be looking at how Fakery took over the world. No, no, hang on, hang on, sorry. You're not Jamie Bartlett, I'm Jamie Bartlett.

Oh really? Well who am I then? I'm afraid you're not real pal. You're just an imitation chatbot I created to help me make this series on modern bakery and why it's everywhere. Sounds good. What's gonna be in it? Well there's a lot. 1980s professional wrestling, dodgy academics, AI psychosis, COVID vaccine, skeptics. What's it called? Everything is fake and nobody cares. With me, Jamie Bartlett. And me, Jimmy Bartlett. Listen first on BBC.