It would be fair to say that the energy crisis has taken its toll on many households’ finances, having sent the prices of gas and electricity soaring.
The situation recently worsened when Ofgem announced a 5% increase in its price cap, with the average UK household’s annual energy bill now calculated to total £1,928 for 2024’s first quarter. The October-to-December cap, in contrast, was £94 lower.
Although energy costs are expected to fall in upcoming quarters, you might still find it difficult to make ends meet — especially if you have accumulated debts from earlier struggles to keep up with your energy payments.
So, should you start casting your eye over a range of bad credit loans on offer?
It's important to note that while bad credit loans can provide immediate financial relief, they often come with higher interest rates compared to standard loans. This means the total amount repayable could be significantly higher.
How should the energy situation shape up nationally?
The Ofgem price cap is specific to Great Britain (England, Scotland, and Wales), but based on how energy is priced worldwide. As international prices have recently dropped, we can expect the amount of money that UK households pay for their energy to also fall.
Dr Craig Lowrey, principal consultant at the energy research firm Cornwall Insight, has enthused in words quoted by MoneyWeek: “Forecasts show energy bills returning to their lowest levels in over two years, providing a much-needed respite for a nation struggling with a cost-of-living crisis.”
He added: “Fairly healthy gas supply across the Atlantic, coupled with high storage levels in Europe, are helping to keep bills down.” However, Lowrey warned that “we mustn’t get too complacent”, as “we cannot be sure another political or economic crisis won’t send bills straight back up.”
How can you help protect yourself against a future energy crisis?
The current precariousness of the UK’s energy system could alarm you if you are still reeling from financial shocks of the last few years.
If you have fallen behind with energy payments in that time, you may now have a poor credit score. This, in turn, might seemingly deny you access to a loan with which you would be able to cover upcoming energy costs as well as repay any debts you have been lumbered with.
Mercifully, though, we can introduce you to many lenders specialising in bad credit loans. Yes, these are loans where you wouldn’t need a good credit history in order to obtain them. Also, this type of loan can be spent on almost anything…
Lenders may conduct assessments to ensure that loans are not only accessible but also affordable for you, taking into account your current financial situation to prevent further financial distress.
Lowrey has pointed out that switching more quickly to “sustainable energy” while reducing reliance on “volatile imports” is key to bringing energy prices down.
Obviously, you can’t directly control how the government handles the green energy transition. What you could do is put your home through a green energy transition of its own.
What we are suggesting here is that your bad credit loan could fund an array of eco-friendly home improvements — from insulating notoriously “leaky” areas like lofts to replacing energy-inefficient appliances and installing “smart home” tech, solar energy panels, and heat pumps.
Warning: Late repayment can cause you serious money problems. For help, go to moneyhelper.org.uk. Think carefully before securing debts against your home.
With a little help from the no-obligation loan application form on our website, you could be offered bad credit loans within minutes — and even have the money transferred to your bank account on the same day.
Rest assured, the loan offers you receive are based on rigorous assessments of your affordability and creditworthiness, designed to ensure you're not taking on more than you can handle.
This blog is shared solely for informational purposes and should not be considered as financial or legal guidance. We encourage you to carry out your own research and seek advice from a professional advisor to confirm that the information is applicable to your particular circumstances.
"Warning: Late repayment can cause you serious money problems. Always consider if borrowing is the right option for you and ensure you can repay your loan." For help, go to moneyhelper.org.uk.