"Affordability" - the new endowment?

Gorgeous_George

Anybody ever heard of OAPs sending money to companies claiming that the pensioner has won a foreign lottery?

Anybody heard of phishing where criminal organisations try to con people into parting with their bank details and passwords?

Well, the banks do the same. They offer hideous sums of money to everybody in the hope that some will part with their signatures and will be tied into repaying the monies over and over again, under the threat of legal action.

I often agree with meanmachine and rarely with eatmyfish. This time I can sympathise with both viewpoints.

Until we have a mandatory qualification that acts as a key to significant borrowings, we will always have people being duped into borrowing more than they can afford. I just hope that I am not penalised because of the stupidity of others as I have been with endowments.



GG

RHemmings

This is very interesting, it's exactly the same pattern we've had when this question has come up before.

Including the very strange claim that we live in some unrestricted capitalist society.

In the UK, you aren't allowed to sell whatever you want unrestricted. Try creating a pyramid scheme or start selling an unlicensed lottery, and see how far you get. For any sort of product, if you misrepresent the product, that's also against the law.

So to just say that it's all the borrowers fault is invalid. To claim this is because they are SELLERS, or that we live in some unconstrained capitalism, is just plain wrong.

So why are people so frantic to blame all inappropriately loaned money on the borrower alone?

Jennifer_Jane

RHemmings wrote: »

This is very interesting, it's exactly the same pattern we've had when this question has come up before.

Including the very strange claim that we live in some unrestricted capitalist society.

In the UK, you aren't allowed to sell whatever you want unrestricted. Try creating a pyramid scheme or start selling an unlicensed lottery, and see how far you get. For any sort of product, if you misrepresent the product, that's also against the law.

So to just say that it's all the borrowers fault is invalid. To claim this is because they are SELLERS, or that we live in some unconstrained capitalism, is just plain wrong.

So why are people so frantic to blame all inappropriately loaned money on the borrower alone?

Ah - who has said we live in an 'unconstrained capitalist society'?

I did say we lived in a capitalist society with a mixed economy.

Other examples given have been fraud, which is illegal. The Bank may be immoral for offering an additional £205000 to meanmachine, having offered £200000 the year before, but my own experience has been that they have offered me less than I wanted (for stoozing). So they do appear to have checks in place.

I think there are in general (Financial/mortgage) codes of conduct and laws, which correctly are in place for the protection of people. How effective these are, I have no idea.

I haven't really seen any evidence that people are 'frantic' to blame borrowers rather than lenders.

eatmyfish

RHemmings wrote: »

This is very interesting, it's exactly the same pattern we've had when this question has come up before.

Including the very strange claim that we live in some unrestricted capitalist society.

In the UK, you aren't allowed to sell whatever you want unrestricted. Try creating a pyramid scheme or start selling an unlicensed lottery, and see how far you get. For any sort of product, if you misrepresent the product, that's also against the law.

So to just say that it's all the borrowers fault is invalid. To claim this is because they are SELLERS, or that we live in some unconstrained capitalism, is just plain wrong.

So why are people so frantic to blame all inappropriately loaned money on the borrower alone?

Well, I suppose there could be mandatory IQ tests for would be borrowers, but then they'd be lots of whining about the nanny state
Freedom isn't free, it involves responability!

TTMCMschine

I think the OPs post highlights whats really going on. The objective isn't to be nice by lending people money to give them a better quality of life, or to be responsible, it is to saddle as many people as possible with as much debt as possible until the point is reached where the debts become unmanageable.

Firstly the central banks hugely inflate the money supply & lower interets rates to encourage borrowing.
This causes asset prices (houses, oil, food, stocks & shares, etc,etc) to surge far beyond their underlying value, necessitating further borrowing.
This leads to inflation & rising interest rates.
Finally the money supply is suddenly constricted resulting in bankruptcies of people, banks, & businesses & sends the economy into recession.
Then the people behind the above process buy up property, businesses, banks, assets, stocks & shares, etc, etc, etc for a fraction of their underlying value & make huge sums of money.

It's happened numerous times through history & I think is why we have a (deliberately staged) boom & bust economy.

Money & power is what is driving the current madness & it's clear where it's going to end up. Another 18 months & it will be as clear as day.

It's like 1929 all over again.

[Deleted User]

I can agree completely it is a scandal and I believe england would be much better for a statutory cap on a 4times multiplyer or 3 times joint - exact figures pending proffesional research (including credit cards, and other forms of borrowing). People are stupid and they need protecting from themselfs.

House prices are so high because its too easy to borrow your lifetimes salary. Interest rates go up and because they have borrowed too much they cant afford anything and the british retail industry suffers. Defaults on mortgages mean the bonds investors dont make as much as they should. So who f*kin gains from all this !!!! and keeping the working and young middle classes poor? I havent the foggyest have you >!?!

meanmachine_2

It's not a question of whether banks should be lending stupid amounts of money, or how much.

It's how they *market* what they do. They came up with the notion of "affordability", as opposed to lending solely on the basis of income multiples.

I didn't.

Quite clearly they're not lending on the basis of affordability, otherwise they'd be offering me less today than they did last year.

It's a total smokescreen.

That's the point I was making. Why aren't they honest? Why? because they'd get bad press and the public would start demanding regulations.

budget_counsellor_shaz

eatmyfish wrote: »

Well, I suppose there could be mandatory IQ tests for would be borrowers, but then they'd be lots of whining about the nanny state
Freedom isn't free, it involves responability!

As a maths teacher of secondary school children, I understand how difficult some people find maths.

I also help people that get themselves into a financial mess....... Should people that are not able to totally understand what they are signing up too (and there are a lot of them) continually be conned?:mad:

I find it really sad when some people appear judgemental and righteous.

Lenders should be held responsible and I'm so pleased that so many people have been successful in claiming back unfair bank charges. :T

Banks and building societies have a good reputation and most people will trust them not to rip them off. :rolleyes:

Shaz

eatmyfish

budget_counsellor_shaz wrote: »

As a maths teacher of secondary school children, I understand how difficult some people find maths.

I also help people that get themselves into a financial mess....... Should people that are not able to totally understand what they are signing up too (and there are a lot of them) continually be conned?:mad:

I find it really sad when some people appear judgemental and righteous.

Lenders should be held responsible and I'm so pleased that so many people have been successful in claiming back unfair bank charges. :T

Banks and building societies have a good reputation and most people will trust them not to rip them off. :rolleyes:

Shaz

It's nothing to do with maths, people are just greedy and when it all goes wrong they dish out a sob story about the nasty banks, or don't you feel people should act like adults and not a bunch of whining cry babies!

Jennifer_Jane

The original OP wanted a comparison of A&L etc versus Endowment mis-selling. I wasn't in the country at that time, but I think endowments are not evil, per se (separate debate perhaps?), it was the 'promise' of future gains which depended on stock market growth, which has been considered to be mis-selling. So, no, I don't really think that they compare. Perhaps the banks could give more information, but I would still ask the OP, if he/she has actually been formally offered the loan?

Regarding teaching in schools, I was very carefully taught about stocks and shares in school arithmetic at my secondary modern - that didn't really help when I lost a couple of thousand on dot-coms. Which I consider to be my own silly fault/a fast learning curve.

Jen