It's harder for FTB's

mewbie_2

IveSeenTheLight wrote: »

I've not been lucky, I bought in an area that has a very strong rental market.
I also market the properties very competatively and look after my tenants.

Luck has nothing to do with it, being a good landlord that understands the market has it all to do with it.

Perhaps, to borrow from the famous golfer saying, the more you research the luckier you get.

IveSeenTheLight

mewbie wrote: »

Perhaps, to borrow from the famous golfer saying, the more you research the luckier you get.

We'll, you know I am a long term advocator of doing your local area market research.

chucky

nearlynew wrote: »

Because you said this in post #16...........



What you mean is..., it's ok for anyone who used financial trickery to obtain a mortgage and now can't afford it to be rewarded by maintaining high prices.

But anyone who has been saving for years and remains unable to afford high prices should be excluded from your "home ownership club"

actually no that isn't what i said but a good spin on everything - well done :T

no doubt yoyur sound bites have attracted the attention that you craved.

ps... your a member of your own "homeownership club" too - you own 3 properties and have just sold one. don't you feel guilty or a tad hipocrytle saying this??

lemonjelly

nearlynew wrote: »

So is it right then, that people should be repossessed if they can't keep up with their mortgage payments ?

Speaking (typing?) as a person with experience of working with those who are faced with losing their home, I think we need to evaluate this question. My answer is, sometimes, yes it is right.

Thing is, it is also preventable in most cases.

If you remove a lenders right to repossess the property, you'll have mayhem. After all, what incentive would there then be to give mortgages? The whol;e notion of a mortgage/secured loan is to give the lender that additional security.

If you remove lenders right to repossess the property, no-one would repay the mortgage.

You have to be proportional with these things. Yes, protect borrowers. However, at the same time, the lenders do (believe it or not) also require levels of protection.

Were we to remove the right to repossess, only those with massive inheritances would ever be able to buy & we'd be a nation of renters.

Anecdotally, In the last 12 years I've seen people who've lost their home. I've seen a few who shouldn't have, & have supported them as best I could. I've seen a great deal who should've lost their home, but owing to a spectacular sob story/sympathetic judge/poor lawyer for the lender, or even for reasons which astound me haven't, & quite probably deserved to.

Thrugelmir

lemonjelly wrote: »

Speaking (typing?) as a person with experience of working with those who are faced with losing their home, I think we need to evaluate this question. My answer is, sometimes, yes it is right.

Thing is, it is also preventable in most cases.

If you remove a lenders right to repossess the property, you'll have mayhem. After all, what incentive would there then be to give mortgages? The whol;e notion of a mortgage/secured loan is to give the lender that additional security.

If you remove lenders right to repossess the property, no-one would repay the mortgage.

You have to be proportional with these things. Yes, protect borrowers. However, at the same time, the lenders do (believe it or not) also require levels of protection.

Were we to remove the right to repossess, only those with massive inheritances would ever be able to buy & we'd be a nation of renters.

Anecdotally, In the last 12 years I've seen people who've lost their home. I've seen a few who shouldn't have, & have supported them as best I could. I've seen a great deal who should've lost their home, but owing to a spectacular sob story/sympathetic judge/poor lawyer for the lender, or even for reasons which astound me haven't, & quite probably deserved to.

So how would you recommend improving the system?

Tightening up on lending criteria even ? To reduce the possibilty of people arriving in such a position.

Or an increae in social housing. As maybe Mrs T's sell off of social housing has in its self created an issue which needs addressing.

dopester

Thrugelmir wrote: »

So how would you recommend improving the system?

Tightening up on lending criteria even ? To reduce the possibilty of people arriving in such a position.

Didn't Gordon Brown do history?

He should absolutely have some knowledge of the problems which come with excess debt. Instead the build up of debt has been their championing policy... their 1997+ partying years of absolute glory, with 'No more boom and bust.'

It was common in antiquity for states to be weakened by dispossessed freeholders and insolvent debtors.

Given the high interest rates that are common even today in backward economies, running into debt was rarely a way for a small holder to rescue his livelihood. Generally, when smallholders went into debt they lost their property and their freedom. Sometimes they legally pledged their persons as collateral for a loan. At other times, their bondage was debt bondage. In either case the result was social unrest that destabilised the system.

This happened in almost every Greek city-state. It was the reason for Solon's reforms in ancient Athens. He found a city simmering no less than Mecca. Solon stabilised the situation by prohibiting lending on the security of a person's body and decreed a general cancellation of debt similar to the Biblical Jubilee.

Muhammad had seen in the Mecca of his own time how a disproportionately large population of the poor, fraught with discontent, could militarily weaken a system. This was not because the poor themselves were able to overthrow the local elite. It was rather that they had no reason to defend the system when it did come under attack. Muhammad exploited such a weakness in taking Mecca.

The injunction against usury was an artificial means of ensuring a wider distribution of property. It was also a roundabout, religious limitation on taxes. By narrowing the availability of credit to finance tax payments, usury discouraged high taxes. They made it relatively easier for small owners to avoid being squeezed off their lands by the oligarchies.

lemonjelly

Thrugelmir wrote: »

So how would you recommend improving the system?

Tightening up on lending criteria even ? To reduce the possibilty of people arriving in such a position.

Or an increae in social housing. As maybe Mrs T's sell off of social housing has in its self created an issue which needs addressing.

Actually, I don't think there is a great deal wrong currently.

Years ago, the unregulated mortgage market was a mare. Since regulation, there is a lot of responsibility on lenders to ensure that what is being loaned is affordable & (here's the important bit) repayable.

What I would actually like to do is transfer this to unsecured lending too. Think about it, unsecured lending is based on legislation from 1974. Now if that is when it was made law, it was probably drafted around 1972. The idea of the act was probably first mooted in 1970-ish. How relevant is it to todays market?

If you think about credit cards, you can nowadays get literally thousands of them. In the late 70's/early 80's there were only 2 or 3. The credit market (& range of products) has exponentially grown. Yet the relevant law is 35-40 years old. It is outdated & needs bringing into line with modern use of the system it is about.

My hope would be that this would enforce a more responsible line on unsecured lending, and therefore reduce the levels of unsecured lending, meaning it would be less likely that people could borrow so much that it snowballs, & the action taken by creditors to enforce the unsecured debt results in the potential of securing the debt on an asset.

Again, we've all seen the adverts where a bank will give you a decision on a 25k loan in 15 mins. I mean really, is that professional or appropriate? Given that we're talking about such a high amount of money, I don't think it is. Devaluing the decision devalues the money, the person borrowing it, & the risks they are running.

Generali

lemonjelly wrote: »

Again, we've all seen the adverts where a bank will give you a decision on a 25k loan in 15 mins. I mean really, is that professional or appropriate? Given that we're talking about such a high amount of money, I don't think it is. Devaluing the decision devalues the money, the person borrowing it, & the risks they are running.

The process of giving a loan AIUI is mostly automated so it will be quick. Most of the 15 minutes will be taking details of the borrower to see if they are a suitable customer.

It would be possible to pass a law to extend the process but it wouldn't really serve to do anything other than delay things. It wouldn't change the scrutiny the loan was under.

FWIW, I used to sell credit (and washing machines) at Rumbelows from 1987. Credit took about 20 minutes to arrange and could easily be for a couple of thousand pounds (perhaps equivalent to £5,000 now). Given faster IT and my quicker typing speed I reckon I could process a credit application in 15 minutes today.

nearlynew

chucky wrote: »

actually no that isn't what i said but a good spin on everything - well done :T

no doubt yoyur sound bites have attracted the attention that you craved.

ps... your a member of your own "homeownership club" too - you own 3 properties and have just sold one. don't you feel guilty or a tad hipocrytle saying this??

This is what you said in post #16............

not everyone can and will be able to buy, afford or qualify to buy a house.

..................... then you say that people being repossessed is a bad thing.

So, again, what are you saying?

That one group of people (those about to be reposessed because they can't afford their mortgage) should be helped to stay in their home. Thus maintaining high prices.

But those who would be more suited to home ownership but are excluded because of high prices should not be helped by falling prices.

One set of people should be favoured over others by manipulating the market.

It doesn'tmake sense.
Unless of course you are a HPI cheerleader.



ps I own 2 houses not 3. And the price of each is falling.
Which is great news for my kids and any other future FTBs.

chucky

two houses???

so you're renting one and making money on it... you're also reducing supply so making prices go up...

i guess that you must have sold your other houses - did you sell them at 3 times average salary?