bankruptcy, and new Government Mortgage proposals?

alastairq

I wonder how the new mortgage proposals announced in the recent budget, will help or assist ex-BR's gaining, or re-gaining a foothold on the property ladder?

ensenar

I'm also interested in any answers to this one .. bump!

droiderm

Nobody will know any definitive answers
You could assume that if lenders have indemnity from the government for high ltv mortgages then you might expect some lenders to relax their criteria.
You have to consider most lenders will not lend to ex bankrupts currently
You also have to remember that the lenders and the government don't want a return to pre crash reckless lending .
The best thing anyone can do is keep squeaky clean and save as much as you can
No matter what no lender is going to give it to you on a plate , you will have to earn it .

alastairq

You also have to remember that the lenders and the government don't want a return to pre crash reckless lending .

Was everyone's 'spending' considered 'reckless' at the time?

I think not.


Will the proposals lead to 'reckless spending' in the future?

Well, IMHO, it depends whether one lives in the south east of the country...or the rest of the country?

Lending for a mortgage really is a different kettle-of-fish compared to unsecured credit lending.

Perhaps some lenders' reluctance to enter into a secured property loan with ex-BRs has as much to do with potential property value increases...or the lack of them?

[Hence perhaps why lender required higher percentages of deposit from ex-BRs? To lessen exposure in a flat-line, or receding property market??]

[Personally, I think the policy is an underlying Tory attempt to falsely boost an ailing part of the economy, by encouraging the 'haves' to buy more property...rather than encouraging the 'have-nots'.....who benefit by spin-off?]


Ex-BRs are also seen as 'risky' investment, I also suspect... because they have demonstrated a knowledge of the financial sector greater than the average potential borrower....and are aware of how to use the rules. Evidence can be seen on these pages, of the ignorance of these rules by the ordinary, unknowing borrower?

But this is all hypothetical, and I expect the concept to be roundly denied by all those associated with the industry.

And they would, wouldn't they?

droiderm

I said lending, not spending.
It's common knowledge the banks were over eager to give mortgages out willy nilly, look at Northern Rock, and the massive bail outs the banks have had.

Reluctance to lend to Ex BR's could well be related to the stagnant house prices. It may well change, as may lending criteria regarding defaults etc in a rising market.

The reason they want higher deposits is to reduce risk. Like it or not, we are high risk. The lenders need to mitigate that, and that's one of the tools available to them.

Whatever the reasons for the policy, and I have no opinion on that.

Unfortunately, a BR in your history is going to hurt forever when it comes to mortgage lending. You can't control what lenders may or may not do in the future. All YOU can do is make yourself a better bet.