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Bank of England warns of tougher curbs on mortgage lending
Comments
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RenovationMan wrote: »There is no logic in allowing someone with huge debts, a spendthrift lifestyle (lot of monthly outgoings on mobile phone contracts, Sky tv contracts, car finance) to have a 3.5 x salary mortgage even though he will struggle to meet the monthy repayments while preventing someone who is completely debt free and has a frugal lifestyle from having 4 x salary who would easily meet the monthly repayments.
Can`t argue with that. But when I hear that lenders have not verified the incomes of a fair proportion of recent mortgage takers, or that in the early part of this year 40%+ of mortgages were self-cert, it isn`t the multiples or even affordability that concerns me. It`s the "fiddling". Whatever measures are taken to "control" the mortgage market, they need to be fair, and properly enforced.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
Sadly the BoE do not seem capable of thing more than 5 minutes into the future. Hence the mess we are in. Their latest wheeze is that savers should blow their savings to get things moving and sod what happens in 5 years time.
So, when the savers have spent, what happens next ?
Despite savers now getting a poor deal, a lot will be feeling fairly good about the fact that they didn`t blow all their money during the "good times". I know I am. The last thing I`m going to do is go on a spending spree, just because the BoE says I should. I saved for the longer term, I`m not going to spend for the short term.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
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So, when the savers have spent, what happens next ?
Despite savers now getting a poor deal, a lot will be feeling fairly good about the fact that they didn`t blow all their money during the "good times". I know I am. The last thing I`m going to do is go on a spending spree, just because the BoE says I should. I saved for the longer term, I`m not going to spend for the short term.
Exactly, just seems that the BoE don't seem to look that far ahead.0 -
Exactly, just seems that the BoE don't seem to look that far ahead.
To be fair, they sometimes do.
I remember Merv, at the beginning of the year, telling us that the rise in inflation was just a blip, and will fall back later in the year.
Oh, they`d better stick to the short term.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
i don't completely get this thing about savers are hard done by Mr Prof...So, when the savers have spent, what happens next ?
Despite savers now getting a poor deal, a lot will be feeling fairly good about the fact that they didn`t blow all their money during the "good times". I know I am. The last thing I`m going to do is go on a spending spree, just because the BoE says I should. I saved for the longer term, I`m not going to spend for the short term.
as we all know interest rates go up and down
interest rates go up and down for people who borrow money - you make your choices and take your chances on mortgage rates or loan rates.
why should saving rates be any different?0 -
I see weird contradictions in media reports all the time, everyone seems in a agreement that the financial crisis has been to the detriment of the UK economy, it was caused by very poor lending by the banks to very poor borrowers.
There has been contradictory data released all the way through this downturn.
However I don't think the fact that there is contradictory data is down to the media (though I have no doubt certain sections of the media are more selective about what they choose to report, & how they report it;)). I think that there really is a lot of contrary data out there. Which adds to the uniqueness of the situation we are in.
Which is why there has been nothing even approaching consensus on this board, or even in the real world to date...It's getting harder & harder to keep the government in the manner to which they have become accustomed.0 -
i don't completely get this thing about savers are hard done by Mr Prof...
as we all know interest rates go up and down
interest rates go up and down for people who borrow money - you make your choices and take your chances on mortgage rates or loan rates.
why should saving rates be any different?
Cos I as got savings innit?;)It's getting harder & harder to keep the government in the manner to which they have become accustomed.0 -
lemonjelly wrote: »Cos I as got savings innit?;)
As a long term strategy, I would suggest that if as a country we had encouraged people to save rather than run up debt over the last decade or so, then the financial crisis we are now in would not have been nearly as bad.0 -
As a long term strategy, I would suggest that if as a country we had encouraged people to save rather than run up debt over the last decade or so, then the financial crisis we are now in would not have been nearly as bad.
Wouldn't disagree. I did think I'd highlighted the irony in my post with the
at the end.
Believe me, I work in the advice sector & have seen the debt mountain grow in an unsustainable way for 13-14 years. I have known for some time that the good times were built on unsustainable consumer borrowing, & it couldn't last.
I believe that both borrowers and lenders are to blame. Borrowers repeatedly asked for more debt, & took on additional debt without fully knowing/understanding the implications or given thorough thought to the repayment of their debt.
Lenders doled out cash irresponsibly, without taking into proper avccount borrowers other responsibilities or ability to repay. In many cases, lenders employed dubious, unethical and questionable tactics in order to get people to take on more debt.
But I do like to throw in the occasional funny too if I can...:)It's getting harder & harder to keep the government in the manner to which they have become accustomed.0
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