24/05/2014 Your Money

more than half a million quid, which might not have a big impact on many

people, but it could have an impact on the rest of the housing market.

Hello and welcome to Your Money, your weekly guide to making the most

of your cash here every weekend on BBC News television and available

all week on the BBC iPlayer. Limiting home loans. Lloyds puts a

cap on the size of its bigger mortgages. Will the others follow

suit? We'll ask one mortgage expert. We pay more for your gas and

electricity if we pay by cash or cheque. One MP says it's time to

curb the extra charges. Consumer champion Ann Robinson tells us to

switch to direct debit for a cheaper deal.

And making your holiday cheaper by working for it. We'll show you how

it's done. The mortgage lenders are already

asking tougher questions to make sure new borrowers can afford to pay

their loan back. Now one big lender is capping its biggest mortgages. If

you need a new home loan of more than half`a`million quid, Lloyds

will only lend you what you earn over four years. The amount you can

borrow is capped at four times your annual salary. Jane King is mortgage

adviser at Ash`Ridge Private Finance If you're with Vodafone and

this only applies to all its customers for loans of more than

half a million quid so that is quite a small number of people. It will

only affect about 8% of Lloyds customers who want to borrow more

than half ?1 million. For the last majority of lenders, four times

Valerie is the norm across the board. `` four times salary.

So this isn't a signal that we have been slack in the past?

I think if you look at it, the people who want to borrow that type

of money are going to be high earners so I would say from a risk

basis, it has not really been thought through properly.

This is something that you and I will remember if you wanted a

mortgage, they would only give you two and a half times your salary. Is

there an informal cap that is in place for all mortgage borrowers or

do they look at different ways of affordability?

There is a general cap by which they won't go over but they do take into

account commitments and other things. Although there is an

affordability element, even if you have no commitments, there is a

maximum income they will use. When they talk about salary, do they

mean the base salary, over time, bonuses?

Normally it is income tax can be evident so 100% of salary, 50% of

bonus, commission. Unless it is declared to the revenue, they won't

take it. If you're with Vodafone and you've

got a deal that says how many minutes and texts you can have every

month and then you use more than that allowance, you're going to have

to pay more for it. Vodafone is increasing its charges. A standard

UK call outside the allowance in your contract will cost 45p a

minute. increasing its charges. A standard

UK call outside the That's an increase of 5p per minute. But the

cost of a European call will fall by just under 6p per minute to 18.7p.

It will cost five pounds to call some directory enquiry services.

Five quid! That's for calls to 118 500, 118 404, 118 247, and 118 212.

Here's an important thing to remember ` under new rules, if your

bill goes up by more than 10% you have the right to tear up your

contract early and go to another phone company without charge.

Vodafone says anyone wishing to do so must write to them before prices

are raised on 28 June. Just looking at the Vodafone website

earlier ` there's a specific section on cancelling your account. You get

to it by going to the main page, typing "cancel account" into the

search box and clicking on the obvious option offered. But that

page only offers you a live web chat or a phone number. If you want to

write to the company, on its tech forums Vodafone says you can use the

form on its "contact us" page. Make sure you put the words "cancel

contract" into the message box. Just to be clear we're not advising

you to do cancel or telling you to cancel, just giving you the

information about how to do it if that what you've decided to do

already. It's your decision. If you do NOT use direct debit to

pay your gas or electricity bill you probably pay more for your fuel. 12

million people pay an average of ?80 more a year each simply because they

pay the bill by cash or cheque. One MP has told our reporter Brian

Milligan that enough is enough and the extra charge should be capped at

?24. If you pay each energy bill as and

when it arrives, you are subject to a surcharge of around ?80 a year.

Unlike customers who pay by direct debit. You won't find mention of

this on the bill itself and as a result, many customers are not aware

they have to pay it. I didn't know that.

Will you change your mind? Possibly.

I would rather feed my house than the shareholders.

Would you like to save money? Yes, but I would rather it was in my

bank account. Do you know it costs you ?80 a year

not to pay by direct debit? No. ?80?

Some companies charge even more if you don't pay by direct debit. Among

the big six, npower charges ?94 yet several smaller companies charge

nothing at all. One MP wants the surcharge capped at ?24 to protect

consumers. This is not a discount, it is a

premium on the country who prefer not to pay by direct debit and it is

an extortionate amount of money and unnecessary.

Energy companies defend the charges by saying it is a more expensive way

for them to collect the money they are owed because some people don't

pay their bills on time and ?80 is the average cost of chasing bad

debt. Indeed, this week the regulator Ofgem rules such charges

are perfectly fair and admitted to becoming something of a seriously

hot topic. A lot of questions are being asked about the fairness of

these additional charges so one of the things we want to do is convene

a round table with MPs, the government and suppliers and

consumer bodies to really wrestle this issue to the ground.

One idea is those who pay by direct debit should share the cost of debt

collection but that would mean higher bills for 14 million people.

Ann Robinson long time consumer champion currently works for the

price comparison website U`switch. We have long known the people who

pay by cash or cheque paid more because the company said that it

costs more to administer the payments but ?80 a year is a lot of

extra administration. It is a lot of money and I'm happy

to hear there will be a round table so people can be assured and we can

get to the bottom of this but the real point is it costs more if you

pay when you get your bill. It is not just about chasing debt, there

are a lot of other customer service issues about people clarifying their

bill. Let's get to the bottom of it and finding out what the position

should be. As Brian said, there is a big

variation. One company was ?94 and one company with no charge at all.

Between the big six, there is a company that charges ?71 and as you

said, another company is charging ?94. I really do think that

everybody should seriously consider direct debit. We know, for example,

over half of us to pay by direct debit and the surprising fact is

that some of the people who struggle the most to pay their bills, half of

them pay by direct debit. I think it is right that what you pay reflects

what it costs to run your account and not subsidise because you can

find that people are in desperate situations and subsidising other

people so it is right we picked up the cost before.

But you understand the concern with the direct debit, it is the energy

company that says how much comes out of your account. You have to trust

them to ask for the right amount and you have to trust them the bank is

going to do it right. First of all, the energy company has

to review that direct debit and if there is going to be any change,

they have to talk you through it and explain why. The second great thing

is there are no rules `` there are new rules whereby if the company is

hanging onto Your Money, you can get a repayment. There is another point

I would like to make. Too often people on direct debit sit back and

take no notice. Don't do that. Stay in control. If you're mutual hasn't

been read by the company, make sure you are checking your meter. Do it

twice a year or so you can make sure your direct debit is accurately

reflecting the energy you use. Stay in control.

There are putting your feet up. Stay in control. `` no putting your

feet up. So you have to ask for Your Money

back? Most of the companies have actually

agreed to an annual review so they will look at it once a year, review

it and if you are in credit, pay it back. If you ask for your cashback,

take it to the energy ombudsman. You are entitled to do that.

It's a Bank Holiday Weekend. Here comes the rain. If you're looking

for a holiday with a difference, how about a working holiday? Even the

kids can join in. Ramzan Karmali laboured long and hard over this

one. You might think of the working

holiday as something from yesteryear, like this. Or perhaps

gap year trips to far`flung faces. But working vacations here in the UK

are growing in popularity supply are more and more people willing to roll

up their sleeves and pitch in rather than relaxing on a sandy beach?

We've done all sorts of things, helping with beach clearance...

Melanie has been on around half a dozen working holidays. She has been

able to take advantage of sailing lessons and cave tours and for her,

this side of the vacation is one of the many and if it is.

I am a museum curator so I am used to working inside with object so it

is quite different to be able to get outdoors and just be outside and

trying all these different conservation activities. Working

with other like`minded individuals and meeting new people as well.

There are a number of organisations that offer a wide variety of

getaways. Possibly one of the key attractions to a working holiday is

the cost. A more leisurely break at a National trust cottage will start

at around ?220 but a working holiday could set you back ?135 for the

week. If you are thinking of a king one of these, there are things to

look out for. A working holiday or volunteer

holiday is still something you have to work for so you have the cost of

the holiday itself, insurance, travel and also some extras because

they are quite basic, on the whole. The accommodation is likely to be

basic so if you like your creature comforts, you will probably have to

take them with you. There is quite a choice when it

comes to these holidays, from farming to construction and even

working on an archaeological dig. Some of these holidays can cater for

the whole family. These breaks can be both rewarding and challenging.

For the organisations you will be working for, it is essential.

Some of it is physical. The sort of thing we do in the countryside is a

lot of habitat management though we are out in all weathers, carrying

tasks with hand tools. They have a real important influence.

If you are looking for new experiences, willing to get your

hands dirty and up for learning new skills, this could be the holiday

for you. That's all from Your Money for this

week. Keep up to date all week long with energy bills, savings, pensions

and mortgages on the BBC's website. You can get updates by following our

feed on Twitter. We're @BBCYourMoney. Thanks for watching.

More next week. Hope I've got your company then.

This is BBC News. We've received a statement from the Prime Minister,

David Cameron, following the discovery of the upturned hull of

the yacht, the Cheeki Rafiki and the loss,