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So The Bulls Keep Bleating On About FTB's
Comments
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:rotfl::rotfl::rotfl:
I could have saved you all that drivel.......
Why didn't you just say "i want liar loans and 100, 125% mortgages to return so FTB can get up to their neck in debts and the foundation for HPI can return"
TBF, Hamish has already stated that he wants more lenient lending for FTB's. It's his selfless campaign so that the younger generation can get a foot on the ladder. Or something like that.
I have already pointed out that the sooner 90% mortgages are widely available, the demand for 95% mortgages will follow. When 95% mortgages are widely available...........
Isn't this a bit like a pyramid scheme ? If it is, then Hamish wants to be one of the Pharaohs.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
I have already pointed out that the sooner 90% mortgages are widely available, the demand for 95% mortgages will follow. When 95% mortgages are widely available...........
Isn't this a bit like a pyramid scheme ?
No, it's nothing like a pyramid scheme.
What's wrong with a 90% mortgage for a first timer buyer who has a good credit history and can afford a sensible monthly repayment? Nothing. Just because you have this in place it doesn't mean we go back to supid 125% mortgages, that's just something you're assuming.0 -
I await his response with interest....“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »I await his response with interest....
Why? It's you who is calling for lending levels back to 2007.0 -
No, it's nothing like a pyramid scheme.
What's wrong with a 90% mortgage for a first timer buyer who has a good credit history and can afford a sensible monthly repayment? Nothing. Just because you have this in place it doesn't mean we go back to supid 125% mortgages, that's just something you're assuming.
Erm, no, I`m not asuming anything.
Well, I am actually. I`m assuming that the demand for property will outstrip supply in the near(ish) future. Once lending restrictions are relaxed a little, it'll only be a matter of time before most FTBs will need a 90%+ mortgage. When FTBs stop entering the market again, due to lack of higher LTV mortgages, Hamish & Co. will campaign for 95% mortgages........ and so on, until 100% mortgages become the popular choice. The only way this will be avoided is if property prices don't increase as much as FTBs salaries, or maybe 30+ year mortgages will start to be introduced.
Oh, and to answer your question "What's wrong with a 90% mortgage for a first timer buyer who has a good credit history and can afford a sensible monthly repayment?" Nothing. Nothing wrong with that, as long as those monthly payments remain sensible.
The longer interest rates stay low, the more people will come to rely on them. For the sake of their own financial welfare, I hope that FTBs consider the implications of a mortgage rate of 7% before signing on the dotted line. I'd say that would be a sensible thing to do. My first mortgage was a repayment with endowment policy, with an interest rate of 7.4%. At the time, the general consensus was that my mortgage rate would likely fall, rather than rise. Unless the rise was drastic (going up by more than 3%), I didn't forsee any problem meeting the payments.
Interesting response Hamish ?30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
Interest rates. Intersting. The only reason they are so low is to recapitalise the bank. I know folk with £150k mortgage, having to pay short of a grand a month. With jobs insecure and inflation kicking off at a right rate of knots, how long do you think these rates will last?
All those people in construction, most of my family, have had a great income for years, also spent a lot of it. Can`t see wages increasing. 0.5% spells out to me, a very dangerous situation, with no place to go.
Can you imagine what could happen with public sector jobs going, massive increase in fuel, doesn`t look pretty to me.
Btw, watched Camerons speach today. What a plonker. We need risk takers he said to drive bussiness forward. Been there for years, crippling interest rates. Unlike the banks I didn`t get tax payers money to bail me out. Can`t see this lot in power very long.0 -
Erm, no, I`m not asuming anything.
Well, I am actually. I`m assuming that the demand for property will outstrip supply in the near(ish) future. Once lending restrictions are relaxed a little, it'll only be a matter of time before most FTBs will need a 90%+ mortgage. When FTBs stop entering the market again, due to lack of higher LTV mortgages, Hamish & Co. will campaign for 95% mortgages........ and so on, until 100% mortgages become the popular choice. The only way this will be avoided is if property prices don't increase as much as FTBs salaries, or maybe 30+ year mortgages will start to be introduced.
Oh, and to answer your question "What's wrong with a 90% mortgage for a first timer buyer who has a good credit history and can afford a sensible monthly repayment?" Nothing. Nothing wrong with that, as long as those monthly payments remain sensible.
The longer interest rates stay low, the more people will come to rely on them. For the sake of their own financial welfare, I hope that FTBs consider the implications of a mortgage rate of 7% before signing on the dotted line. I'd say that would be a sensible thing to do. My first mortgage was a repayment with endowment policy, with an interest rate of 7.4%. At the time, the general consensus was that my mortgage rate would likely fall, rather than rise. Unless the rise was drastic (going up by more than 3%), I didn't forsee any problem meeting the payments.
Interesting response Hamish ?
Mildly interesting.....
Now as to 90% + mortgages, actually I do have a position on them, as follows:
Historically, mortgages up to 95% have been available to FTB's without any difficulty. I was offered one in 1990, my parents were offered one in 1967.
Mortgages of 100% have been around at least as early as the 1980's, and I recall a poster here saying he got one in the 70's.
But in general terms, I'm actually not in favour of 100% mortgages being the norm, and I'm absolutely against any mortgages of more than 100% under any circumstances.
So in order to return to sensible, responsible, lending that balances the needs of FTB's with the need not to go back to the crazy lending seen in 2007, I would suggest the following should happen:
-- 90% mortgages should be the default position for FTB's, widely available, with no interest rate penalty compared to 75% mortgages.
-- 95% mortgages should be available, but only with Mortgage Indemnity Insurance to cover the bank against loss, just like happened in the old days. This would typically cost a one time fee of 2% of the mortgage, and the rates should probably be less competitive to deter people.
-- 100% mortgages should only be available under very limited circumstances. As one example, for key workers living in areas where rent is far more than a mortgage, who simply could not save up a deposit in a reasonable time. And a premium should be paid, so with insurance, and probably at a rate penalty for the first few years.
Now that would in no way represent a return to irresponsible lending, indeed, it's simply a return to historical norms. So anybody campaigning against such a thing is simply wanting to hurt the housing market at all costs, no matter how many FTB's get locked out of the market in the process.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: ».
-- 90% mortgages should be the default position for FTB's, widely available, with no interest rate penalty compared to 75% mortgages.
That sounds like a nice idea and possibly something that could be pushed through, but I suspect it'd just mean 75% mortgages being more expensive.This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0 -
That sounds like a nice idea and possibly something that could be pushed through, but I suspect it'd just mean 75% mortgages being more expensive.
No, the banks have only recently started this rate discrimination.
There's no historical basis for it at all.
The excuse they give for this profiteering is the new capital retention rules, but if that's the case they'll just have to be modified.
Anyway, this is all a bit pointless, as the government will have to start pushing for more lending in the next couple of years anyway. You can't win an election with a housing market languishing in the doldrums, nor with a wider economy still being dragged down by an underperforming housing market.
The political and commercial pressure is building, slowly but surely, and at some point things will simply have to change.
We're already seeing the first, early, results of Shapps FTB conference, with some higher LTV deals coming back although still at punitive rates.
Given enough time, the mortgage market will return to normality. But at quite some cost for the poor FTB's forced into enriching their landlords for the best part of a decade in the meantime.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0
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