Interest-only mortgages expiring

exiled_red

marksoton wrote: »

All of which begs one question. Why oh why is personal finance not a mandatory curriculum item at schools/colleges?

I'm 38 so i stand corrected if it now is.

Hell, just do one term on it and tie it in on other subjects like cookery on further terms. Call it what you want, i dunno call it "lifestyle skills".

Why are such basics omitted to the detriment of society as a whole?

It really should be be. I'm a couple off years younger than you, my school did PSE (Peresonal and Social Education) I would assume that such things could/should have been done in these sessions. But the reality of this in my school at least was that this didn't count for anything, the teachers weren't really trained to teach this subject and the majority of the time we just sat there doing nothing worthwhile. In my opinion the school probably just considered it as somewhere to keep the kids for the spare hour a week on the timetable rather than actually doing anything useful.

exiled_red

Thrugelmir wrote: »

Should be ingrained through culture. My parents and grandparents always reminded me of financial basics. Some where along the road business was allowed to dictate to make a profit. At the expense of human misery and distress. Given this lady was 70. No excuse for her being of the post war generation. Rationing and all.

I think that there is a generation of adults now who don't know or care about this kind of stuff and wouldn't be able to pass it on to their kids, the society that we live in has really changed it's attitude to finances, greed and responsibility over the last 20-30 years. Alot of people now seem to have a large sense of entitlement and often take no responsibility for their actions.

marksoton

Thrugelmir wrote: »

Should be ingrained through culture. My parents and grandparents always reminded me of financial basics. Some where along the road business was allowed to dictate to make a profit. At the expense of human misery and distress. Given this lady was 70. No excuse for her being of the post war generation. Rationing and all.

Completely agree, and i'm not one of those that subscribes to the state teaching children/young adults what their family should. But it's clearly not working.

Such fundamental's should be up their with maths, English and maybe a foreign language and sciences as a priority.

It may be a cliche but they ARE life skills that'll serve anyone well.

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marksoton

jimbog wrote: »

It isn't, which is really frustrating.

I always spend at least some time each year telling/warning teenagers about different types of mortgages/loans/payday loans/guarantors/insurance etc...

Do you mind if i ask in what capacity Jim?

penguingirl

We ported our interest only mortgage last year (we took out the original mortgage in 2009). We were struck by how much more vigorous the bank were in checking we understood it. In total we had about 5 hours of telephone appointments to go through it with a fine tooth comb, and this was to port it to a lower LTV and our salaries had pretty much doubled in the 6 years! They were very keen to check we discussed repayment vehicles and wanted us to be explicit in our plans. We definitely felt that they were covering themselves in case we ever said it had been misold. We were also sent a summary of the conversation with our answers. In reality we are making capital payments, but liked the flexible of an interest only offset plus wanted to keep our rate and avoid fees.

Sadly I know a lot of people who won't move because they won't 'make money' on their house. I live in the NW and there are lots of areas that haven't gone back to 2008 prices. We sold for a small loss last year.

And as for those who say learn from your parents- my parents got caught by endowment mortgages in the 80s and climbed the property by pure luck by relocating at opportune times. OH's parents have lived off finance most of their lives and have overpaid on almost every product possible! Thankfully we've learnt from some of their mistakes (and those of older siblings), but who knows? In 10 years time there may have been huge house price inflation in our area and we might regret borrowing only a small amount.

exiled_red

Interest only mortgages work well for some people, and generally these are people like yourselves who are actually aware of the full picture. I think that alot of the problems with them are due to people who went into them for the wrong reasons or didn't adapt to the changing financial climate and are now desperate for a way out or looking for someone else to blame.

Dird

jimbog wrote: »

I always spend at least some time each year telling/warning teenagers about different types of mortgages/loans/payday loans/guarantors/insurance etc...

marksoton wrote: »

Do you mind if i ask in what capacity Jim?

https://www.youtube.com/watch?v=N6hoGbCaQhQ

jokes jokes. Are interest-only mortgages now completely banned for residentials?

Thrugelmir

Dird wrote: »

jokes jokes. Are interest-only mortgages now completely banned for residentials?

Not banned just highly regulated. For lenders is it worth the bother to offer the product on a commercial basis. Probably not. Given the very low margins on mortgage lending now.

Many lenders that offered the product in the credit boom are long gone or now under different management/ownership. As a lending model it didn't work. There's a decade or so of unwinding to go yet.

jimbog

marksoton wrote: »

Do you mind if i ask in what capacity Jim?

I teach business studies to 16 to 18 year olds and while personal finance isn't part of the syllabus (as yet) I always include it where I can.

What is remarkable is how most have absolutely no knowledge of basic personal finance and how they all sit up and pay attention when I do so (even coming off their phones :eek: )

marksoton

jimbog wrote: »

I teach business studies to 16 to 18 year olds and while personal finance isn't part of the syllabus (as yet) I always include it where I can.

What is remarkable is how most have absolutely no knowledge of basic personal finance and how they all sit up and pay attention when I do so (even coming off their phones :eek: )

I thought as much. Thank's Jim. I was genuinely curious not nosing!

That's an interesting reaction you get. When i studied BS, Economics and law at that age it gave me a basic grounding commercially wise for the future but there was nothing personal finance wise.

Sadly it seems nothing has changed. Keep up the good work. At least someone is trying!