Philip Hammond ditches Osborne's help-to-buy homes scheme will no longer be available after 2016. In a letter to Bank of England governor Mark Carney, the chancellor said the scheme had a “specific purpose that has now been successfully achieved”. Launched in late 2013, the scheme meant buyers only needed to raise 5% of the property value for a deposit, with a government guarantee on a further 15% to give mortgage lenders the incentive to loan larger amounts. The scheme was scheduled to expire at the end of 2016, but mortgage lenders had called for it to be replaced, warning that its closure would push the first-time-buyer market back into decline.
To understand why so many are in the wrong band, we need to time travel back to 1991. Not long after the poll tax riots, it was announced the system of local taxation would, by 1993, be replaced by the council tax. It banded people from A (the lowest) to H according to house price – the bigger, the more you pay. To make it work, a stop-gap system was set up known as “2nd gear valuations” – literally two people driving down streets with a clipboard containing basic data, looking at homes, assigning bands as they went.
The Bank of England's Financial Policy Committee believe that the planned closure of the Help to Buy: Mortgage Guarantee scheme "would be unlikely to affect significantly the provision of finance".
Employees who request a state pension estimate are often shocked to find that they are entitled to considerably less than they expected. But even those who have worked for several decades can easily receive hundreds of pounds a year less than the “full” new state pension of around £8,094 a year (£155.65 a week). This is because they paid a lower rate of National Insurance as a result of being “contracted out” of the top-up state pension. The money was used instead to boost their workplace pension, or sometimes a private plan. “Contracting out” is enormously complicated. Here we explain how it works and how you can get the best possible deal from the state pension.
The Bank of England’s latest decision on interest rates fell on the eighth anniversary of the collapse of the US investment bank Lehman Brothers, one of the seismic economic events of the past 100 years. On that day, official borrowing costs in the UK stood at 5%. In the months that followed the Bank of England’s monetary policy committee cut them aggressively until in early 2009 they hit 0.5%.