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Debate House Prices
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Is fraud propping up house prices ?
Comments
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CKhalvashi wrote: »
At the same time, the mortgage fraud that we know takes place (but don’t know the amounts) would not be so dire that it affects property prices. Anyone telling you otherwise needs to come up with hard evidence of this.
Just my 2p
CK
There are many ways it does affect market resiliance.
One of the most common things I come accross is people wanting to get a second property but only with a 10% deposit.
They then let one of the properties, often the new one with the lenders latter day consent of course.
In other words the true extent of B2L is certainly under reported.
Richard Branson and Annita Rodick (Bodyshop) both took out 'car' loans, to start a business'. Are they fraudsters?
I'm not condoning anything irregular, but you just have to be realistic and accept it goes on.
Now I'm not some sort of surrogate Police Officer. It does irk me when someone for example sublets thier council place, but I don't see it as my place to break the bond of trust and go squealing off. People would soon put 2 and 2 together and have me put in a lake or something!
It's the HMRC's job to collect Tax, not mine.0 -
Thanks Conrad for your reply.
Although I am not naive enough to think that tax dodging and "fiddling" doesn't take place, I am quite suprised at the extent that does seem to go on from what you have said. Firemen undeclared businesses on the side, Asian shopkeepers with several houses in their kids names, it sounds to me like there is more than a little tax evasion taking place. I wonder what the effective cost of all this is to the 9-5 worker who is taxed by his employer ? He has very little room to avoid paying his fair share of tax, unless of course he starts a business in his spare time. A lot of us are not happy that our car insurance premiums have been inflated by spurious whiplash claims, it has been said that it costs each and every car driver about £40 a year. I am suprised that there is not more annoyance at those who are evading tax. Bad enough that the rich and famous can afford to exploit loopholes, but those that sub let council properties are not only claiming benefits that they aren't legally entitled to, but they are hardly going to be "giving a little back" by declaring the income that they get from renting out the property. And then you tell us that you regularly meet people like this ! I take it that they come into your office wanting to borrow money. Oh to be a fly on the wall !30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
Demand for owner occupation purchasing has dropped back due to mortgage rationing. Rent is going up as a consequence, with prices settling as a function of yield.
Right, so lending DID have an impact to higher prices then.
Good, glad we cleared that up. You can't afterall, have it both ways and suggest lending didn't increase prices, but lower lending pulls them back.0 -
Now I'm not some sort of surrogate Police Officer. It does irk me when someone for example sublets thier council place, but I don't see it as my place to break the bond of trust and go squealing off. People would soon put 2 and 2 together and have me put in a lake or something!
It's the HMRC's job to collect Tax, not mine.
You do have a duty to report it though, which is exactly what you don't do.
Therefore, you knowingly, as an advisor, participate in the fraud. Would you suggest otherwise?
Mortgage advisors have a bad name. People like yourself are why.0 -
Richard Branson and Annita Rodick (Bodyshop) both took out 'car' loans, to start a business'. Are they fraudsters?.
I'd love to see the answer to this one....“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'd love to see the answer to this one....
The answer to this one is simple.
It wasn't a car loan.
You cannot get a car loan without buying a car.
You can get a personal loan however and state your intention. Though what you do with it is completely up to you.
You try popping into a dealer and getting a HPI loan without a car.0 -
Graham_Devon wrote: »The answer to this one is simple.
It wasn't a car loan.
You cannot get a car loan without buying a car.
You can get a personal loan however and state your intention. Though what you do with it is completely up to you.
You try popping into a dealer and getting a HPI loan without a car.
Funnily enough, it's not quite correct. (although I can see where the confusion came in)
From her book.....
In 1976, she tried to raise a £4,000 bank loan to start The Body Shop, but was turned down. 'The banks were useless at the start,' she says, 'and still are. It's easier for a woman to raise money for her new kitchen cabinet, or even a car, than for a business enterprise.' So her husband, Gordon, borrowed the money - and gave it to her.“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'd love to see the answer to this one....
Whilst at the same time they could have typically committed fraud, was the loan specifically for a car, or was there something else in there.
From the original post, we don’t know all of the facts. Did they own cars, then take out finance secured against 2 cars that they owned, or did they not have the correct security? This is a question that hasn’t been answered.
We own our cars outright, so what’s to stop me taking out a £30k loan secured against a ’61’ plate S-Max, and a £50k loan secured against OH’s ’12’ 525d, secured against them, then starting a business with the same cash? I’ve secured the loan on the car, exactly the same as borrowing £480k against my house on an 80% LTV to start a business. I have access to potential borrowings of £550k-ish through security that I have, and could have that in my bank account to use at my free will, on condition I could find a lender to agree I need it.
In the 2 circumstances above, we would have not committed fraud, as we presumably never stated any more than ‘it’s for a car/house’, which it technically is, as it’s secured as such. The fact that I own cars and my property outright, in the eyes of the law (though not of the lender) should be the same?!
CK💙💛 💔0 -
Graham_Devon wrote: »You do have a duty to report it though, which is exactly what you don't do.
Therefore, you knowingly, as an advisor, participate in the fraud. Would you suggest otherwise?
Mortgage advisors have a bad name. People like yourself are why.
TBF, Conrad hasn't stated if he reports this kind of thing or not. From his earlier post, it would appear that he does not......
"Now I'm not some sort of surrogate Police Officer. It does irk me when someone for example sublets thier council place, but I don't see it as my place to break the bond of trust and go squealing off."
What I'd like to ask him, but I don't expect an answer, or at least an honest answer is -
What action do you take when ......
"I get gals who claim a council flat and sub let it as they have a secret property / partner elsewhere just so they get the right to buy gift."
I'm assuming they are coming to you to get a mortgage. I suspect you don't report them, as you previously said, but do you help them get a mortgage (if, indeed, that is the reason that you meet them). ?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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