Double standards - mortgage payers shafted

Alan_Cross

See this:

http://www.moneysavingexpert.com/news/utilities/2009/08/energy-firms-told-to-slash-prices-b

... and then tell me where 'Ofmort' is when you need them...


I accuse the Government of doing nothing about lenders smirkingly raising their fixed rates while paying next to nothing for their supply of cash.

yelf

The government are making them - through demanding they have more stable balance sheets

LizEstelle

The government is doing no such thing. Nobody is asking these institutions to become cash rich in double quick time.

The economy is in a parlous state. What are we going to do with a couple of dozen ultra-rich mortgage lenders when the rest of us are on our knees?

This is just profiteering when they think HMG is soft on them, pure and simple.

opinions4u

Alan_Cross wrote: »

I accuse the Government of doing nothing about lenders smirkingly raising their fixed rates while paying next to nothing for their supply of cash.

Alan, I know we will continue to disagree on this, but here is a link to Swap Rates which give you a far better guide to the cost of mortgage funding.

Look at the left hand column for each term (1 year ago) and look at the right hand column (today) and that explains exactly why rates for mortgage finance have edged upwards.

They are not "paying next to nothing for their supply of cash".

Increased cost of funding + increased risk of lending = not very likely to reduce prices to consumers.

LizEstelle wrote: »

The government is doing no such thing. Nobody is asking these institutions to become cash rich in double quick time.

They are asking them to hold more capital. If they've lent it, they aren't holding it. Reduced supply = higher price. It's called economics. Google "supply and demand curves".

The economy is in a parlous state. What are we going to do with a couple of dozen ultra-rich mortgage lenders when the rest of us are on our knees?

Which ones are "ultra-rich"?

This is just profiteering when they think HMG is soft on them, pure and simple.

Profits from retail banking (the bit of banks that includes residential mortgage lending) have fallen at RBS, Lloyds, HSBC and Barclays. Making less money is not profiteering.

yelf

LizEstelle wrote: »

The government is doing no such thing. Nobody is asking these institutions to become cash rich in double quick time.

The FSA is asking banks to ensure they have large enough funds to withstand any future crises - to do this they need to build their balance sheets. So by charging way more than they give helps them to do this.

On a similar vein: http://www.bbc.co.uk/blogs/thereporters/robertpeston/2009/08/what_rbss_results_say_about_qe.html