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FSA Rejects LTV/LTI Mortgage Caps......

135

Comments

  • HAMISH_MCTAVISH
    HAMISH_MCTAVISH Posts: 28,592 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    digipeep wrote: »
    Ah I see the HPC troll Hamish has found his/her way to MSE.

    Yes, do try to keep up at the back there.:whistle:
    “The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.

    Belief in myths allows the comfort of opinion without the discomfort of thought.”
    -- President John F. Kennedy”
  • JayScottGreenspan
    JayScottGreenspan Posts: 1,008 Forumite
    The problem with basing affordability on monthly payments is that this exacerbates the cycle: when interest rates are low people tend to borrow more anyway, this sort of affrodability criteria goers further and offers them even more credit. Until interest rates creep back up, of course, which will cause defaults on the previously affordable loans, a pull-back from lenders, and more severe affordability restrictions.

    If you want boom and bust in the credit market, this sort of affordability measure is exactly what you want.

    Conclusion: the FSA contains >=2 idiots.
  • LittleMissAspie
    LittleMissAspie Posts: 2,130 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Generali wrote: »
    It's pretty crude to cap things in this way. What about a couple where one half has had a temporary reduction in income or someone who has a secure job where their income is highly likely to rise very quickly, like a doctor for example?
    It is crude perhaps but I don't see how it would disadvantage anyone. The couple with a temporary reduction in income will just have to wait a little longer. House prices in general would be more stable with a cap, I think. So no missing the boat. The doctor can use his payrises to pay off his initial smaller mortgage very quickly and move up to a bigger house later. It actually saves him interest in the long run.

    Out of interest, what amount of money do banks consider acceptable for disposable income after mortgage costs, anyone know?

    Also I thought Hamish was Mitchaa. Are they actually different people?
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    HAMISH_MCTAVISH wrote: »
    Financial Times

    :T:T:T:T

    Game on.

    That was the last great hope of the bears.

    The next booms gonna be huge........

    Why?
    “There are lots of mortgage players out there at the moment who have very sophisticated tools to assess genuine affordability and even the ability to withstand interest rate changes,” he said.

    This could potentially place a far greater restriction on many people than an income multiplier.
  • Vegeta
    Vegeta Posts: 383 Forumite
    Hey look, no-one has thanked Hamish McTavish for his post.

    Surprise! :rotfl:
  • IveSeenTheLight
    IveSeenTheLight Posts: 13,322 Forumite
    Vegeta wrote: »
    Hey look, no-one has thanked Hamish McTavish for his post.

    Surprise! :rotfl:

    there's not many sockies on the "bull" side ;) [ISTL takes cover]
    :wall:
    What we've got here is....... failure to communicate.
    Some men you just can't reach.
    :wall:
  • Conrad
    Conrad Posts: 33,137 Forumite
    10,000 Posts Combo Breaker
    ManAtHome wrote: »
    Sounds like a good move - no more 5 times salary for people already maxed out on credit cards and loans. Looks like the FSA are agreeing with current lending policies and won't be rubber-stamping Trooser's orders to get back to 2007 lending levels for a long long time (about bleeding time for a bit of (un)common sense to creep in).


    Sorry, you've misunderstood.

    Just about every lender has been using affordability models as opposed to income multiples for some time now.

    Affordability models still result in some applicants being granted 6 x salary and others 3.

    Those with high unsecured debt levels, simply ask Dad to repay it for them just prior to completion and the day after they can max out and pay Dad back, so as ever if determined enough, people will always beat the system.
  • mbga9pgf
    mbga9pgf Posts: 3,224 Forumite
    “There are lots of mortgage players out there at the moment who have very sophisticated tools to assess genuine affordability and even the ability to withstand interest rate changes,” he said.

    Sophisticated to me says frigged. Look where the quants 'sophisticated' top level models got the interntational banking system. Just wait till the Tories take over. Multiple restrictions here we come...
  • HAMISH_MCTAVISH
    HAMISH_MCTAVISH Posts: 28,592 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    mbga9pgf wrote: »
    Just wait till the Tories take over. Multiple restrictions here we come...

    :rotfl:

    Did you forget who the Tories housing advisor was??????

    :rotfl:

    No chance the Tories wil restrict mortgage lending......;)
    “The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.

    Belief in myths allows the comfort of opinion without the discomfort of thought.”
    -- President John F. Kennedy”
  • chucky
    chucky Posts: 15,170 Forumite
    10,000 Posts Combo Breaker
    mbga9pgf wrote: »
    Multiple restrictions here we come..

    i thought that it was already happening in September and was fact according to you. oooops another one of your crazy predictions... oh yeah sorry, i forgot you're going to tell about the ARM 'timebomb' :money:

    House prices down to at least 115K... Thans FSA! 3X here we come!
    http://forums.moneysavingexpert.com/showthread.html?t=1560959&highlight=
    mbga9pgf wrote: »
    :beer:

    http://www.propertyweek.com/story.asp?sectioncode=297&storycode=3136243&c=1




    Taking the bulls imaginary average wage of 36K (Yeah, right....)
    plus the 5% deposit, prices WILL crash to at least 115,000 average... this is before the effects of any recession (depression) are factored in.

    :rotfl::rotfl::rotfl::rotfl::rotfl:

    before we start to go on about the same stuff repeated THIS IS NEW!!!!!


    Everyone dance along with bowie now...

    http://www.youtube.com/watch?v=30AVhf-ZLwM
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