New Mortgage Rules - Aren't They Wrong?

anotheruser

So as I understand it, mortgage companies are now asking what sort of lifestyle you have to figure out if the mortgage rate goes up, you can pay it.

As I understand if you go to the gym, eat out every week, have subscriptions to Sky or magazines, this will potentially count against you.

But shouldn't they count for you?

Surely if you have those things (let's say out of contract), then if the mortgage rate went up then you could easily save money while someone who puts everything they have in to a mortgage won't have any spare cash.

Maybe I have got this wrong here...

Thrugelmir

anotheruser wrote: »

Maybe I have got this wrong here...

Just like many people these days. The media is also financially illiterate. Presenting a totally nonsense perspective. When it comes to borrowing money. People on the whole are overly optimistic as to their financial circumstances. Wishing to borrow as much as they possible can. By forcing people to list their outgoings they'll have a much better understanding of where they stand. Better prepared for the ball and chain that will be around there ankles while repaying a 25 year mortgage. Which amounts to 300 on time monthly payments.

Life is a roller coaster. Start off on a mortgage on the wrong foot and financial disaster could strike at some point in the future.

Just common sense really.

dunstonh

As I understand if you go to the gym, eat out every week, have subscriptions to Sky or magazines, this will potentially count against you.

But shouldn't they count for you?

1 - do those things aid your ability to repay your mortgage?
2 - have you been falling for the media hype a bit much?

Things are just returning to where they were back in the 70s through to early 90s.

Surely if you have those things (let's say out of contract), then if the mortgage rate went up then you could easily save money while someone who puts everything they have in to a mortgage won't have any spare cash.

or perhaps it indicates an out of control consumer spending lifestyle fuelled by addiction

Goldiegirl

I think a lot of it is down to people seemingly being unable to take responsibility for themselves.


If it goes wrong, they invariably blame the lender - 'they shouldn't have lent it to me in the first place'.


They never look to themselves, and think, hold on, we've got a big new mortgage, we need to stop those meals out. Or if the interest rates go up, they still carry on with the Bluewater (or other shopping mall) sprees, and don't think about making cutbacks.


As people seem to have lost the ability to take responsibility, legislation has had to be brought in, so someone else can think the thing though for them, when it comes to lifestyle and affordability. People can no longer be trusted to work it out for themselves


That's how I see it, anyway

wrkactjob

People will just delay buying that BMW until after the mortgage offer.

Goldiegirl

wrkactjob wrote: »

People will just delay buying that BMW until after the mortgage offer.

When it all goes wrong a couple of years down the line, they'll only have themselves to blame. They won't be able to blame the lender anymore ( but they won't blame themselves either, they'll find someone else to pin it on, probably the person that sold them the BMW:rotfl:)