British Gas

British Gas

August 08, 2012 03:00 ET

New and Potential Home Owners Given a Financial Boost

LONDON, UNITED KINGDOM--(Marketwire - Aug. 8, 2012) - With the Funding for Lending Scheme announced, new homeowners can combine lower lending rates with smart home technology to stay on top of household bills.

On 13 July the Bank of England and HM Treasury launched the Funding for Lending Scheme (FLS). It is designed to boost lending to households and businesses, with a view to kick-starting the economy. The scheme works by allowing banks and building societies to borrow from the Bank of England for up to 4 years. As security against that lending, banks will provide assets, such as business or mortgage loans, to the Bank of England. Banks will be able to borrow on this scheme during the 18 months from 1 August 2012 until 31 January 2014.

Banks will be given strong incentives to boost the amount they are lending by lowering interest rates and increasing the availability of business loans and mortgages. The scheme is designed to ensure that the more a bank lends, the more they can borrow from the Bank of England. Banks that are increasing their lending will pay the lowest fee on their own borrowing, while those that reduce their lending they will end up paying a higher fee.

The aim of the scheme is to help lower the rising costs of borrowing and counter a drop in lending, which has fallen 16% since its peak in 2008. Mortgage costs are causing particular concern to consumers, with lending rates having risen 0.5% in the last year.

All of these changes spell great news for current and prospective home owners, with a greater availability of mortgages and home loans that can be repaid at a lower rate.

Once you've secured a mortgage and found a new home, the savings and deals don't have to stop there. To help consumers understand and control their household bills, the Government have recently announced plans for every home in the UK to have smart meters installed. The mass roll-out of smart meters is expected to start in 2014.

Smart meters are electronic devices that are designed to provide accurate and advanced data readings so that consumers can accurately see just how much energy they are using, and how much it is costing them. As a result, consumers can monitor their own energy use and keep track of how much they can expect to pay on their next bill.

Energy suppliers will be responsible for replacing over 53 million gas and electricity meters, involving visits to 30 million homes and small businesses. If you are a customer with British Gas, you will receive your smart meters from British Gas directly.

The answers to many smart meter FAQs, including all the benefits, can be found online in the British Gas smarter living page.

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