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Mortgage Valuation a whopping 77k under agreed sale price
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Yes I think lots of people pay more than what things are worth if they bought with cash. Maybe not 6x something's value, but certainly a hefty percentage. That's why credit works imo. Buying a sofa interest free spread over 4 years more people will buy than paying the same price at the beginning.
I suppose it depends how savvy you are and this is mse after all.Never again will the wolf get so close to my door :eek:0 -
I think there is a lot to be said for the way people fund a purchase of a house, or anything else for that matter. If someone will provide loans for any amount that enables someone to get what they really want, many people will take it (hence the mess people get into).
A bank owns a share of the house to the value of the loan, the loan is against the house and is an asset the bank can seize if the debt isn't repaid, so the way I see it is that it's not "your" house until you have the deeds. Also banks won't lend what they value at, only a percentage, which to me speaks volumes of the risk element associated with house prices.
I agree my analogy in my previous post was rubbish.
Lenders were the main culprits in inflating the bubble, and in this case it looks like they are the main culprits in deflating it as well.0 -
I think it's exactly the other way around. People pay more because it's on credit and doesn't seem much monthly. You pay premium for the fact that you don't have the whole amount at hand.Yes I think lots of people pay more than what things are worth if they bought with cash. Maybe not 6x something's value, but certainly a hefty percentage. That's why credit works imo. Buying a sofa interest free spread over 4 years more people will buy than paying the same price at the beginning.
I suppose it depends how savvy you are and this is mse after all.
Perfect example is a "free" mobile phone on £40+ a month 24 months contract.0 -
I think it's exactly the other way around. People pay more because it's on credit and doesn't seem much monthly. You pay premium for the fact that you don't have the whole amount at hand.
Perfect example is a "free" mobile phone on £40+ a month 24 months contract.
Big step up from a mobile to a 700k + house though?0 -
Could have been a whopping 79k after any Brexit vote!0
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