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No more Liar Loans

245

Comments

  • Pete111
    Pete111 Posts: 5,333 Forumite
    Mortgage-free Glee!
    Can I ask how prevailant these 'liar loans' actually were?

    I took out mortgages in 2004 and 2007 and each time significant proof of income was required - from speaking to my mates they had to provide this also.

    I accept some loans given were dodgy as hell - especially in the mid naughties - but realistically, is this as big a deal as some posters like to claim?
    Go round the green binbags. Turn right at the mouldy George Elliot, forward, forward, and turn left....at the dead badger
  • Graham_Devon
    Graham_Devon Posts: 58,560 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    edited 13 July 2010 at 2:33PM
    chucky wrote: »
    no argument with self-employed - it's going to be painful for some and not sure if it's fair...

    not sure about your fast-track comment - because you can be employed (not self-employed) and not have to have to prove your income through this 'fast-track' method. that's if you have a good/high credit score. it's happened to me with the halifax.

    Yer, it doesn't matter if your self employed or not to get a fast track.

    However, in the case of them being removed, it's the self employed that will be hit, as those employed and on the books will have the payslips to prove their income, so can revert back to a "normal" type mortgage.

    Self employed have no choice. I assume something would have to be done, as there are so many self employed now. Maybe a years books or something would be taken into consideration.
    Pete111 wrote: »
    Can I ask how prevailant these 'liar loans' actually were?

    Pretty prevalent. The article states that even in the first quarter of this year, 43% of all mortgages were of the type when you do not have to verify your income.

    What we can't tell are how many are dubious.
  • StevieJ
    StevieJ Posts: 20,174 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    How does someone with a 60% deposit fit into this, would they have to prove their income? or someone moving house, is it just for FTB?
    'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher
  • chucky
    chucky Posts: 15,170 Forumite
    10,000 Posts Combo Breaker
    StevieJ wrote: »
    How does someone with a 60% deposit fit into this, would they have to prove their income? or someone moving house, is it just for FTB?
    they would go under the 'fast-track' thing i mentioned - it was with the Halifax so may be called under different names with other lenders.

    the lower the LTV the less underwriting and less proof of income required.

    like the others thing sbein suggested - i can't see this being introduced as it is and will be diluted down before it is implemented - even for self-employed.
  • StevieJ
    StevieJ Posts: 20,174 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    edited 13 July 2010 at 3:09PM
    History of fears.

    http://www.citywire.co.uk/money/morning-line-the-mortgage-timebomb-and-its-docile-watchdog/a414047?ref=citywire-money-featured-articles-list

    I have to ask, why were almost 50% of mortgages on supposed risky self-cert (2007- 2010) when credit
    had dried up, doesn't make sense, unless of course self-certs were less risky.
    'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher
  • chucky
    chucky Posts: 15,170 Forumite
    10,000 Posts Combo Breaker
    StevieJ wrote: »

    2007 – 2010: Self certs account for almost half of all new mortgages.

    this would surprise me very much if it were true - we've just had the biggest credit rationing ever and lenders are really going to lend to self-certs... doubt it very much.
  • StevieJ
    StevieJ Posts: 20,174 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    chucky wrote: »
    this would surprise me very much if it were true - we've just had the biggest credit rationing ever and lenders are really going to lend to self-certs... doubt it very much.

    I updated my post in passing, the very same thoughts icon7.gif
    'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher
  • nearlynew
    nearlynew Posts: 3,800 Forumite
    chucky wrote: »
    ...............the lower the LTV the less underwriting and less proof of income required.

    Geniune question -

    What does this bit in bold actually mean, in practice?

    How does proving less of your income work?
    "The problem with quotes on the internet is that you never know whether they are genuine or not" -
    Albert Einstein
  • JonnyBravo
    JonnyBravo Posts: 4,103 Forumite
    Mortgage-free Glee!
    nearlynew wrote: »
    Geniune questio -

    What does this bit in bold actually mean, in practice?

    How does proving less of your income work?

    The broker is supposed to hold the proof on file but the bank doesn't ask to see it.
    Blinking madness.
  • RenovationMan
    RenovationMan Posts: 4,227 Forumite
    I think this has already come in unofficially. I went through a broker for my mortgage and had to supply details of income (three payslips). I had to supply a fourth to show my latest pay just before we completed because it took longer than expected due to the to-ing and fro-ing over the stuctural engineers report (our house is a listed building that's about 260 years old, so I wasnt taking any chances).

    They did insist on actually seeing the payslips but strangely didn't ask to see proof of a repayment vehicle on the interest only mortgage, which was a good thing, because there isnt one! :eek:
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