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MSE News: Warning - if the state helps pay your...
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SkyeKnight wrote: »If someone gets out an interest only mortgage in their early 60s I can't help but think they intended for the state to pay for it for the rest of their lives. It would be exactly the same cost to them as buying a property they could afford with the benefits of living in a nicer houe and bigger house price increases to leave to their children.
The building societies only lend what the borrower can afford to pay back whether that be from earnings or pension. With an interest only mortgage their is/was an endowment policy to fund as well.
When OH stood as guarantor for my daughter they would only give her a mortgage until he was 75 and based it on his pensions income so they were covered if she defaulted.0 -
If that type of scheme was in operation it would have suited me no end. 1 bed flats around here rent out at about £1000 a month. Give me £500 of SMI towards the mortgage interest would give me a mortgage debt of £425,000.0
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Is HB relly that generous? ( have just looked it up and in Merton it is) Staggering, it should be the HB not SMI that is looked into. Where are these people living or are the landlords just trying it on. My son rented a 1 bed flat in Notting Hill last year for £1500 per month but he funded it himself and it wasn't the cheapest he could have rented, always had expensive tastes.
HB was one of the first benefits "they"looked into they split it into HB and LHA0 -
SkyeKnight wrote: »If someone gets out an interest only mortgage in their early 60s I can't help but think they intended for the state to pay for it for the rest of their lives. It would be exactly the same cost to them as buying a property they could afford with the benefits of living in a nicer houe and bigger house price increases to leave to their children.0
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The building societies only lend what the borrower can afford to pay back whether that be from earnings or pension. With an interest only mortgage their is/was an endowment policy to fund as well.
When OH stood as guarantor for my daughter they would only give her a mortgage until he was 75 and based it on his pensions income so they were covered if she defaulted.
Have you never heard of 'liar loans'? Most banks & building societies in those days did little checking and relied entirely on what the applicant said. There was no proving anything, the general answer as to how it was to be repaid was ' I am due an inheritance'.
https://www.thisismoney.co.uk/money/mortgageshome/article-3710974/Mortgage-lender-targets-unemployed-bid-bring-sub-prime-liar-loans.html0 -
Have you never heard of 'liar loans'? Most banks & building societies in those days did little checking and relied entirely on what the applicant said. There was no proving anything, the general answer as to how it was to be repaid was ' I am due an inheritance'.
www.thisismoney.co.uk/money/mortgageshome/article-3710974/Mortgage-lender-targets-unemployed-bid-bring-sub-prime-liar-loans.html0 -
HB was one of the first benefits "they"looked into they split it into HB and LHA0
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I'm bumping this thread as the other one about SMI loans has now been closed0
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Robbydabanca wrote: »In this instance, this does not need bumped. I have noted that you close various threads. If this subject needs discussed, new ones will be opened.0
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So people who work and buy a property then become ill will have to pay back but others who don't make the sacrifice will get it all given to them and not have to pay any back and if in private rented accomodation the taxpayer will be paying off the landlord's mortgage.
I will add I don't claim anything although I have paid in for many years and get a reduced state pension ( I made some provision) but know of people who have had expensive holidays, large families and now claim HB. How is that fair?
I dont agree with any free money schemes.
Surely it is better that the government invests in appreciating assets rather than buying houses for BTL landlords?
LHA is of course just free money, someone could claim £100k in LHA, then become a millionaire, and not one penny would be recovered.
JK Rowling, I believe falls into a similar category.0
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