95% newbuy mortgage

The_J

leveller2911 wrote: »

Yes I know we are borrowing at 2% interest rather than 7-8% like Greece.Why do you think the markets lend to us at 2%? could it be because we are a good bet that they will get all of their money back? if so why do you think they have confidence in us? could it be because we are dealing with our debts ?... .

Debt is still going up. The rate at which it is increasing is going down. If we stopped public spending, it would reduce much further, why aren't we doing that? Debt is bad, it must be paid off immediately you were saying?

squeeks

The_J wrote: »

How is this subprime squeeks? Subprime is ADVERSE credit, i.e the debt is not being sustained. If the debt is being paid, what's the problem?

I guess it is my view of over drafts and credit cards. The OP is treading water with these debts, the cards are maxed out with just the minimum payments being made. They don't appear to be a buffer for day to day spending, but utilised as a substitute for long term lending.

Both of these types of debts are expensive and discretionary. They can be removed by the lender at any time. The joint loan is fine, that has a defined term and contract in place. It would appear that the should the CC or overdrafts be reduced or withdrawn by the lenders the OP would immediately be in a default situation, along with removing all their cash flow which could impact other commitments.

Admittedly it is a fine line and the OP appears to be on the right side of it, but for me it looks to be a substantially less than a prime position to be in.

leveller2911

The_J wrote: »

Debt is still going up. The rate at which it is increasing is going down. If we stopped public spending, it would reduce much further, why aren't we doing that? Debt is bad, it must be paid off immediately you were saying?

If you want to discuss this more feel free to start a thread on it.The fact remains our borrowing is cheaper than many other countries due to us addressing our deficit.The reason its reducing slower is that we have no growth. The OP may have a wage freeze for the next 3years, interest rates on CC rising etc the fact remains you were not giving all of the advice you should have.

Why didn't you ask the OP a few more questions relating to where the debts came from, how long they had had them,minimum payments etc etc and then post advice based on a full overview?.In all probability they are indeed treading water and if they take your advice will be back here in 12-18 months time asking for debt advice..

Did your advice take into account the CC debt/limit can and may well be reduced significantly at the drop of a hat?.

I wish the OP all the best for the future

The_J

They are not my client. I have not done a factfind. This is not advice. Can you read my signature?

The OP has mentioned they have £1600 of spare cash a month at the moment. All that has happened is people have said they don't believe it. That is breathtaking arrogance.

Apparently people aren't allowed to pay for a wedding and have children. This person has saved up and spent their savings on that, this shows they are financially responsible.

You can whine about how I'm incompetent (note correct spelling), you can cry like a baby that a mortgage company will allow them to do this, you can blame me for the recession. I don't care.

To call this person subprime, when they have a £1700 underspend, is unbelievable. I would love to see your finances. They could pay off their debts in a year according to their own figures, if the UK could pay off it's debts in a year we'd be in a lot better shape. Try 50 years.

I would say that the weekend definitely brings out the amateurs. Stick to building stuff, something where you don't have to use your brain. If financial advice is so easy give it a try, it's made me a rich man with a happy life and a portfolio of clients who trust me implicitly and you appear to be better than me at it.

leveller2911

The_J wrote: »

I would say that the weekend definitely brings out the amateurs. Stick to building stuff, something where you don't have to use your brain. If financial advice is so easy give it a try, it's made me a rich man with a happy life and a portfolio of clients who trust me implicitly and you appear to be better than me at it.

Oh seem I to have hit a nerve.:D

The fact remains you admit you don't care if the advice you gave went Pete Tong because its not you fault.

And to think people pay you for it ..... enough said.

shortchanged_2

The_J wrote: »

This person has saved up and spent their savings on that, this shows they are financially responsible.

Where is your evidence that they have saved up and paid for their wedding?

They have £17,000 on credit card plus other loans. That doesn't look to me like there was a great deal of saving going on.

brit1234

I am worried that certain posters are encouraging people to take on higher debts, despite having big existing debts and encouraging sub prime schemes such as Newbuy. This is meant to be a money saving forum not encouraging bankruptcy.

The_J

What, because I didn't assume he would have another 2 kids and lose his job and get AIDS? And if all that happened he wouldn't be able to afford the mortgage. Yeah, maybe you won't be so good at this.

As you can see, the "client" has thanked me and not you. Indeed, you have been thanked by the forum HPC and silver nutjob. I think that speaks volumes. If you can keep your judgements and slander towards me and the OP out of this thread maybe we can get back to helping him?

Not only do people pay me for my advice but they are considerably smarter, more successful and richer than you.

The_J

shortchanged wrote: »

Where is your evidence that they have saved up and paid for their wedding?

They have £17,000 on credit card plus other loans. That doesn't look to me like there was a great deal of saving going on.

danpen1306 wrote: »

The reason we have no savings is because we've got married, bought a house at the wrong time and had a baby. This has all happened in the space of two years. We could save up a decent deposit over time but we really want to move now to a better location to bring our baby up and be surrounded by better schools.

We certainly don't live beyond our means. I have £900 free cash after all bills etc are paid each month and my wife has around £700.

I do see your concerns though and thanks for taking the time to reply

If you lived somewhere, and needed a car to get to work but didn't have money. What do you do? You borrow money, buy a car, go to work and pay off that debt. Debt facilitates that.

This person wants to provide a better life for their family and are prepared to use debt to facilitate that. If this means a better school their child could be better educated and look after them in retirement.

Just like the Government will not stop spending on healthcare and schools because it realises it has to invest in the future.

Thrugelmir

squeeks wrote: »

Mr & Mrs Smith get a personal loan for 10k from the bank, the bank is now happy to lend Mr & Mrs smith 90k as they have 10k deposit and they meet the 90% LTV requirement.

May meet the 90% LTV but not the underwriting criteria.