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TV Tonight
Comments
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:o:o:o:o Am so embarrassed to ask.... what are/is MEW and BMV?
Slightly different note..... 8% of mortgages are sub-prime but represent a higher % of repossessions..... emmm, yes, that would be why they are sub-prime??? At the risk of sounding like Terry Wogan..... is it me????
Below Market Value and Mortgage Equity Withdrawal....
I have been thinking this too.... its like saying 80% of people buying brand new porsche's are rich... well der!
Even as a fence sitter I found this show interesting. Except for the young guy in Manchester area earning 14k or something, 24, and he expected to buy a flat?? I'm sorry but he should be renting.... enjoying his youth. Or meeting a significant other and getting a place together.
Before the debate of 2 incomes to support a mortgage crops..... since more and more women choose to work and delay/choose NOT to have families. That's the way its going to go. A single income won't afford a mortgage (especially quite a low single income).
The MEW guy was just pathetic. lmao. Although I know plenty just like him.0 -
It had nothing of the sort. What about the not so stupid people who have made a fortune!?!
Very few people have 'made a fortune' out of property price increases.
A lot of people now have increased equity but that isn't the same thing.
They only make money when they sell the house.
They can of course borrow money against the equity but that just means they are heavily in debt.
Most people who sell their house use the money to put towards a bigger/ better one. As prices rise, this step up costs more and more. This means they end up taking on more debt than they otherwise would have had to do.
Some property speculators have made money, EAs too and definitely builders. But this is more than offset by huge numbers of people up to their neck in mortgage debt which they may ultimately be unable to service.
Higher prices haven't made people in general richer - they have just enabled many people to borrow more in the form of secured loans (mortages, equity release) and thus directly contributed to skyrocketing levels of personal debt.--
Every pound less borrowed (to buy a house) is more than two pounds less to repay and more than three pounds less to earn, over the course of a typical mortgage.0 -
A good point that a colleague made this morning in the office (he's 30 years old living in W. London, rents his place, is waiting for the crash) is that the EA who had MEWed up to the hilt is going to get hit by a double whammy, as he's an EA.
So his income goes down as the number of sales decreases (people don't sell as house prices go down), and his commission becomes less.Errors of opinion may be tolerated where reason is left free to combat it. - Jefferson0 -
I think that EA should work as a trader he certainly knows how to take a position on the market (i.e Take a risk without hedging)
if the market tumbles due to the credit crunch he will be exposed to:
- Massive increase in mortgage payments
- Neg equity
- loss of income or possible redundancy
I wonder if he understands the concepts of a hedge funds
Almost feel sorry for him as he seems very naive, the Ironic thing is that he feels on top of the world living in a false world of wealth....
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I think that EA should work as a trader he certainly knows how to take a position on the market (i.e Take a risk without hedging)
if the market tumbles due to the credit crunch he will be exposed to:
- Massive increase in mortgage payments
- Neg equity
- loss of income or possible redundancy
I wonder if he understands the concepts of a hedge funds
Almost feel sorry for him as he seems very naive, the Ironic thing is that he feels on top of the world living in a false world of wealth....
he isnt at all naive, hes living a great lifestyle spending every penny he can when his house goes up in value and once that stops he will go bankrupt, 7 years of plasma tellys and poncy cars and he can just become a used car salesman after going bust.
how many other people on 10k a year would be able to have the life he has and frankly its not like the banks woulnt lend to him in a few years time anymore.0 -
I think that EA should work as a trader he certainly knows how to take a position on the market (i.e Take a risk without hedging)
if the market tumbles due to the credit crunch he will be exposed to:
- Massive increase in mortgage payments
- Neg equity
- loss of income or possible redundancy
I wonder if he understands the concepts of a hedge funds
Almost feel sorry for him as he seems very naive, the Ironic thing is that he feels on top of the world living in a false world of wealth....
He did have a bit of a sneer though as the presenter told him he STRed in 2004.... I was feeling a bit of sympathy for his stupid actions until then.
The thing is, although you've lost out on equity if you STRed a few years ago you at least still have a lot of money in the bank and (hopefully) no heavy debt commitments over you.
You are disadvantaged if you want to buy back into the housing market at the current point because prices have gone up between you selling and buying. However, if you can wait it out and the market drops back then you are no worse off provided it drops back to where it was when you sold up. It's kind of like the "House price drops only matter if you have to sell the house and can't wait it out" argument in reverse.
At the end of the day I'd much rather be someone sitting on a pile of cash having STRed too early than someone in debt up to his armpits (either through buying at the peak or MEWing) who has to pray that the market keeps rising to bail him out of a tricky financial squeeze.
I really felt sorry for the old woman who sold her house to one of those awful 'sell your home then rent it back' companies. IIRC she sold for 25k less than market value on the basis that she could rent it at a good price, for life. To then lose the house anyway because the buyer defaulted on their mortgage is a real kick in the teeth. But I do have to wonder why she decided to go down that route. Surely she could have sold for full price and had 25k more in her pocket to go towards rent of a similar house?--
Every pound less borrowed (to buy a house) is more than two pounds less to repay and more than three pounds less to earn, over the course of a typical mortgage.0 -
IMO many people in this situation are the same as in the TV prog last week, about people being forced to sell after taking out unpayable mortgages, they just don't have the financial sense to work it out for themselves.Surely she could have sold for full price and had 25k more in her pocket to go towards rent of a similar house?
The people that bought the house off her, are as bad as the self-cert outrageous mortgage sellers that defraud on the paperwork. They are both picking on vulnerable people to make money from.Freedom is not worth having if it does not include the freedom to make mistakes.0 -
Me too - and I can understand tha attraction of wanting to stay in your home rather than rent something similar. But as usual, the "powers that be" will do FA until we get a few adverse headlines in the papers (intentionally didn't use the term newspapers).I really felt sorry for the old woman who sold her house to one of those awful 'sell your home then rent it back' companies. IIRC she sold for 25k less than market value on the basis that she could rent it at a good price, for life.0 -
They're not prime, they're not super-prime, hence they're sub-prime.
I borrowed 4.5 times my salary (now less than 4 times, thanks to a pay rise). This is pretty high.. Am I sub-prime? My credit record is good, and I have no problems paying my mortgage and putting extra away. I got a competitive grad loan, and didn't go for a "sub-prime" lender.
I disagree that high salary multiples are sub-prime in the way that a lot of US loans have been to NINJAs.Errors of opinion may be tolerated where reason is left free to combat it. - Jefferson0 -
I was self-cert on :eek: times my salary!BLOODBATH IN THE EVENING THEN? :shocked: OR PERHAPS THE AFTERNOON? OR THE MORNING? OH, FORGET THIS MALARKEY!
THE KILLERS :cool:
THE PUNISHER :dance: MATURE CHEDDAR ADDICT:cool:0
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