FSA review confirms NO RESTRICTIONS on Loan To Value/Income...

HAMISH_MCTAVISH

In a radical review of the mortgage market, the Financial Services Authority will launch plans to tighten up regulation and crack down on risky lending as part of reforms that will slow house price growth for a generation.

However, the proposals will stop short of Gordon Brown's demand for an outright ban on 100pc to 125pc mortgages although Treasury sources said that there was a "lot of concern" about such loans, which would be heavily controlled.


In February, the Prime Minister asked the FSA to consider a veto on zero-deposit mortgages as he called for a return to traditional banking values.

But the regulator has decided against setting caps on loan-to-value or loan-to-income ratios. Instead, it wants lenders to ensure clients are more rigorously credit checked so they are not extended debt they cannot afford.

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/6360608/Era-of-cheap-mortgages-is-over-British-homeowners-warned.html

I did mention at the time that these proposals would not result in high risk mortgages being banned, not LTV or LTI restrictions being imposed.

And that the proposals would rightly be kicked into the long grass.

Turns out I was right.

No restrictions on LTV or LTI. The days of 3 times salary are over.

Pobby

Hamish, you are bonkers.

edgey88

Hooray common sense prevails - you would only be spending the remainder of your salary 'having a life' anyway

Cat695

Erm people you have got to agree this is surely a bad thing......mental just mental

Graham_Devon

More to the point. Self certification to be banned. Notice that wasn't included in the quoting!

Thats terrible news for self employed. And terrible news for those who needed to lie to afford a home.

Among the report's proposals, the financial regulator is expected to call for an end to self-certification mortgages and rule that responsibility for income verification be transferred from mortgage brokers to lenders. The moves are an effort to crack down on mortgage fraud, which has already cost lenders about £400bn due to borrowers lying about their earnings to secure a home loan.

Also BTL to start being regulated.

Second charge and buy-to-let mortgages, neither of which are regulated by the FSA, are expected to be brought under its supervision. In addition, sub-prime, interest-only, and 125pc mortgages will all be subjected to closer scrutiny and higher capital requirements.

HAMISH_MCTAVISH

Graham_Devon wrote: »

More to the point. Self certification to be banned. Notice that wasn't included in the quoting!

Thats terrible news for self employed. And terrible news for those who needed to lie to afford a home.

True.

However it has been pretty much unavailable all year. (only one lender left offering it, and even then heavily restricted) And that hasn't stopped house prices rising by 9% in the last 7 months....

Also BTL to start being regulated.

BTL has been heavily restricted and pretty much unavailable for anyone that doesn't have a huge deposit all year. And that also hasn't stopped house prices rising by 9% in the last 7 months....

The important part was not to ban 100%+ mortgages, or insist on salary multiple restrictions.

They didn't.

Game over for the bears, I'm afraid.

carolt

HAMISH_MCTAVISH wrote: »

Game over for the bears, I'm afraid.

Are you under the impression you were playing a 'game' with 'the bears', Hamish?

That would explain the infantile nature of your posts.

Buying a home is not a 'game' to other people, and this is not the playground.

Do grow up.

Turnbull2000

He's right. Although they won't publicly admit it, the government will view high LTVs and replacing income multiples with affordability criteria (which does make housing more expensive) as highly desirable.

The FSA have been on record before as saying salary multiples will be detrimental to the needs of first-time buyers, whereas they truly mean it will be detrimental to house prices.

People need to stop believing the outcome will be determined by what's just and required for our long-term prosperity, but rather the actions (or non-actions) of desperate politicians with short-term political aspirations and property portfolios to protect.

bumpoowee

Turnbull2000 wrote: »

People need to stop believing the outcome will be determined by what's just and required for our long-term prosperity, but rather the actions (or non-actions) of desperate politicians with short-term political aspirations and property portfolios to protect.

Unfortunately I think you are exactly right here. Although I think politicians are mainly very keen to appease greedy baby-boomers who have become very wealthy off the back of house price increases, since there are a lot of votes to be won, whereas the young FTBs are less inclined to bother voting I imagine.

I am starting to wonder if we are heading towards a situation where for the vast majority, the only realistic way to own a home is by already owning one or inheriting one. I can see a situation where most of the young, skilled and hard-working population look to emigrate and the only ones left behind are the benefits claimants, to be honest I'm starting to sympathise with them more, after all why bother working when the government has no interest in your future and will take everything from you to uphold the position of a greedy few.

HAMISH_MCTAVISH

carolt wrote: »

Are you under the impression you were playing a 'game' with 'the bears', Hamish?

That would explain the infantile nature of your posts.

Buying a home is not a 'game' to other people, and this is not the playground.

Do grow up.

Ahhh, carol, so predictable.

I do hope you get past this bitter and angry phase soon.

Hopefully it's just the hormones talking, because I'd hate to see you getting desperate like all the bears over on hpc....

Terribly undignified.;)

And whilst I agree the stakes are high, as with most things in life, there are winners and losers, and the hpc junkie gamblers are the clear losers now.

The reality is a lot of people gambled on delaying purchase in the misguided hope of a big crash, when they should have been prudent and bought as young as possible back when mortgages were more affordable than today.

Prices fell, but most of these gamblers are now locked out of the market by high deposit requirements and high rates for FTB's.

Now both prices and rents are heading up, there is almost no prospect of any further meaningful falls, and the gamblers have lost.

By the time FTB rates and LTV's lower to where they were at back in 2007, prices will be massively higher again.

It's a lose/lose scenario for the reckless hpc junkies, who thought they could count on a crash to get a cheaper house at the expense of the prudent people who bought young and estabished themselves on the property ladder.

And after hearing endless posts from bears relishing in the prospective downfall of millions of decent people who just got on with life and bought a place to live, you'll just have to accept that we are more than entitled to feel a certain sense of schadenfreude about the whole thing. :rolleyes:

carolt

HAMISH_MCTAVISH wrote: »

Ahhh, carol, so predictable.

I do hope you get past this bitter and angry phase soon.

Hopefully it's just the hormones talking, because I'd hate to see you getting desperate like all the bears over on hpc....

Terribly undignified.;)

And whilst I agree the stakes are high, as with most things in life, there are winners and losers, and the hpc junkie gamblers are the clear losers now.

The reality is a lot of people gambled on delaying purchase in the misguided hope of a big crash, when they should have been prudent and bought as young as possible back when mortgages were more affordable than today.

Prices fell, but most of these gamblers are now locked out of the market by high deposit requirements and high rates for FTB's.

Now both prices and rents are heading up, there is almost no prospect of any further meaningful falls, and the gamblers have lost.

By the time FTB rates and LTV's lower to where they were at back in 2007, prices will be massively higher again.

It's a lose/lose scenario for the reckless hpc junkies, who thought they could count on a crash to get a cheaper house at the expense of the prudent people who bought young and estabished themselves on the property ladder.

And after hearing endless posts from bears relishing in the prospective downfall of millions of decent people who just got on with life and bought a place to live, you'll just have to accept that we are more than entitled to feel a certain sense of schadenfreude about the whole thing. :rolleyes:

What are you on about, Hamish?

Have you lost your marbles?

What is an 'hpc junkie gamblers' when it's at home?

Why do there have to be 'winners' and losers', Hamish?

It's not a board game, it's real life.

You clearly spend far too much time playing very silly games.

Please find me a single post that counts as 'endless posts from bears relishing in the prospective downfall of millions of decent people who just got on with life and bought a place to live'.

How can you say that yet imagine that it is acceptable for you to 'relish in (sic) the prospective downfall of millions of decent people who just got on with life and DIDN'T buy a place to live'?

Why on earth do you feel 'entitled' (strange choice of word) to feel schadenfreude for others who do not own a home?

What on earth is your problem?

I had thought you were just some well-meaning if rather obsessed joker, but a quick glance down your most recent posts today makes me sad - I have rarely read such a load of utter, pathetic drivel.

Seek help.