'Are mortgages & credit too easily available or too hard to get?' poll discussion

superbabe612

I chose answer A because as someone with a clean credit file I was surprised to have been rejected for a credit card with Halifax, who I bank with, on the grounds of the payment history of my other credit (mobile phone suppliers, insurance companies, etc.) I wanted to check my eligibility after 6 years in the wilderness (former bankruptcy) before I apply for a mortgage. A broker says I should have no problem now that my file is clear but why did I get turned down for a credit card?

Wiselady

Mortgages could be easier - the Banks are being a bit hyper-sensitive. The problem is the pushing of loans and credit cards. This has always been immoral as it is the niave and vulnerable that get themselves into trouble this way. As soon as a person reaches 18 amongst their birthday cards in the post are invitations to apply for credit cards etc. Surely there should be a level of protection in this regard. Loan companies and Banks should have stricter regulations in the granting of loans and credit cards.

ennui

I think credit cards, personal loans etc. are far too easy to get. Mortgages are very difficult to get at the moment.

jamesd

I'd be happy to have more and cheaper unsecured credit available. Can't even borrow as much as I have in investments at the moment, more than my pay, because scoring mainly considers credit and income not savings and investments.

Unsecured and mortgage credit really merit two different questions.

kittykitten

Like most others I voted on a purely selfish basis. I'm good with money (a whole other topic, I know) live well within my means and at 27 feel it's long overdue for me to move out of my parents' house and buy somewhere, but can't get a mortgage, despite having a good credit file and earning a relatively decnt wage, coupled with proof that I could easily afford monthly mortgage repayments. Like others have already mentioned this is more to do with deposit than it is the mortgages themselves. But maybe none if the options given were what I really wanted to vote, maybe the system just needs to be a lot more individually targeted, with lenders spending more time looking at each individual's (or couple's) circumstances, rather than making a judgement based on 2 minutes worth of information which has been largley what I've been asked for?

leaphaze

I spent some time thinking about this but ended up not voting.

I have an excellent credit score and the only time I've been rejected for a credit card (for stozing) over the last 10 years was because I'd applied too early for the next credit card and the issuer bulked at the amount of debt on other credit cards. I'm no longer doing this since the interest rates are so low; I get a higher return using a cashback credit card.

For me, credit is easy to get, although my only debt now is my mortgage. I remortgaged 15 months ago; a pain-free process, but then I do have a lot of equity in my home.

So it really depends on your circumstances, although the amount of adverts on TV for credit should give you a clue.

Conrad

MSE_Martin wrote: »

Im fascinated by this poll - I vascillated myself on what to answer - so it'll be really interesting to see how it turns out.

I've been in discussions with some important people at the FSA and Treasury on this.

I could be construed to be a VI as I own a small mortgage brokerage, but in fact I earn more now that mortgages are more difficult to obtain, so no, I'm not a VI.

I now cannot assist a great many categories of client that hitherto would have been able to buy a home, that are now forced to rent.

Most are perfectly capable of paying a mortgage, yet millions are now barred. This is the great unsung story of the age as it is leading to a gulf between asset owners and renters, the very opposite of a meritocracy.

One example category of clients routinely failing the FSA test (there are dozens of other barred categories though) is older borrowers, many of whom have come through a divorce and want to re - start. FSA rules mean lenders have to demonstrate the pension will be sufficient in retirment. The point is, 99% of such older people in the past did not get repossessed, yet now the majoirty are declined. I've helped many older people in the past and for sure most did not have enough pension to justify the mortgage in 5 or 7 years time, but the point is none of them ever got into trouble. Humans cope and find a way, they meet a new partner, they downsize, they get an inheritance etc. Surely we do not want a society where millions of perfectly capable grownups are told by a nanny state that they cannot do what they think they can?

Again less than 99% ever get repossessed. Keep that in your heads folks.

By all means weed out the heavy sub prime applicants, although even then there is unfairness. Lets say you made some mistakes in the past but for 3 years have paid everything on time. Now lets say rates start rising and you need to remortgage obtain a decent fixed rate THEREBY PROTECTING YOUR FAMILY HOME. New rules make it impossible for any high st lender to assist, so the FSA rules lead to more risk for such people trapped into a single lender.

My MP Oliver Heald has been assisting me in this little campaign, but for the now the FSA generals are completely and utterly out of touch. They talk about meaningless one size fits all 'sustainable markets', but here at the coal face that means Betty aged 60 gets declined and is forced to rent.

BlueAngelCV

I'm another who can't decide.

On the one hand it was obviously far too easy before but on the other it's now virtually impossible to get credit and as for getting on the housing market I can't even imagine a stage when I will be able to.

It seems to me that they don't take into account whether you will actually be able to repay the debt. Before they let pretty much anyone have credit but now you can't unless your practically perfect. There should be more consideration given to indivdually circumstances rather than sticking with a rigid credit scoring system.

You also have to consider the fact that people are in situations where they have too much debt so I think cutting off credit completely so that they now can't have options to transfer balances/change lenders etc is unfair.

TBagpuss

I think one of the problems is that so many of the decisions are made (or seem to be made) automatically on 'scores', rather than on an assesment of the individual.

I think in general it is too easy to get credit, and the habit of credit cards etc increasing limits and offering extra cards to high borrowers is lunacy, BUT that at the other end of the scale there are people who would be good risk but who can't get credit as they don't fit neatly into a box.

So far as mortgages are concerned, I suspect that a return to bank managers having greater discretion, actually interviewing prospective borrowers etc might even things out a little, especially where mortgages are concerned.