FSA warns on levels of UK mortgage debt

Graham_Devon

But interest rates wont make any difference. People were paying higher than now in 2007.

Rinse, repeat....

But interest rates wont make any difference. People were paying higher than now in 2007.

Rinse andddd repeat

Oh, and sack anyone in the BOE who says interest rates should rise. Get rid of entire organisations that look at credit and say anything that could restrict lending and cause heartless famines. Let people state their earnings are x amount for mortgages, and a far lower amount for tax returns, its unfair they have to state the same for both.

macaque_2

Conrad wrote: »

Every single time I mention this people reach for the sour grapes bag. I earn a lot of money now that people need me more than ever for commerical and residental finance.

This is not about me, this is about the perfectly capable adults I see daily, having thier dreams and plans quoshed by an over zealous out of touch regulator.

"I mention.....I earn...... need me...... I see......."
"This is not about me"

Hmmmmm!

zappahey

ukcarper wrote: »

What is affordable lets take a 2 bed terrace near where I live £160k with a 10% deposit a mortgage of £144k.

So at 5x income you would need to earn £28.8k. Take home £1820 a month.

Mortgage payments 25 years 5% £851, 6% £938, and 7% £1029and 8% £1124.
Leaving £969, £882, £791 and £696 respectively

Someone on minimum wage takes home £889 a month.

When was it ever the case that the lowest paid could buy a house?

ukcarper

zappahey wrote: »

When was it ever the case that the lowest paid could buy a house?

You totally missed the point of my post I was just asking at what stage do people think it becomes unaffordable.

My point was that at 5x at 5% the buyer has almost as much after paying mortgage as a person on minimum wage takes home.

Graham_Devon

ukcarper wrote: »

You totally missed the point of my post I was just asking at what stage do people think it becomes unaffordable.

My point was that at 5x at 5% the buyer has almost as much after paying mortgage as a person on minimum wage takes home.

Yer, but without the housing benefit.

Also, it's difficult to get 5% now. Let alone when rates rise.

ukcarper

Graham_Devon wrote: »

Yer, but without the housing benefit.

Also, it's difficult to get 5% now. Let alone when rates rise.

If he was single he wouldn’t get much housing benefit.

In my area LHA single person is £83 per week a person on minimum wage would get about £12.35 housing benefit and working tax credit combined, so would have to find £70 towards rent about £300 a month leaving them about £589.

Kohoutek

ILW wrote: »

Surely a company or individual can increase profits and growth without increasing borrowing.

An individual company could, but not the whole country in aggregate. Creating new loans is the method in which new money is created. That's how our monetary system works.

ILW

Kohoutek wrote: »

An individual company could, but not the whole country in aggregate. Creating new loans is the method in which new money is created. That's how our monetary system works.

So nothing to do with adding value or providing a service then?

Kohoutek

ILW wrote: »

So nothing to do with adding value or providing a service then?

If you can provide greater value or greater goods or services with the same input of capital, then you're obviously increasing productivity and contributing to economic growth.

That doesn't change how our monetary system works – if everyone decided to stop taking out new loans and repay existing ones, we would experience deflation.

The money that people use to buy your business' products or services comes from bank credit that was created by someone taking out a loan.

AD9898_2

mbga9pgf wrote: »

No, this is about you, as a broker, having to take a haircut on your commission.

Suck it up. The credit boom is over.

Mmmm, Conrad's obvious VI shines through every single post he/she makes. The credit boom is indeed at an end. If you 'made hay while the sun shined' in the boom years and put money aside as a broker, good luck to ya, if on the other hand you blew it and are waiting for some mug to walk through your door to 'pedal your wears' to, then I'm afraid they have all but dried up.

So indeed, suck it up.