"Calls" to help HTB mortgage prisioners

mayonnaise

Grezz24 wrote: »

as a FTB about to use the HTB i am fully aware of what the costs are involved, i have seen a full breakdown of what i will potentially pay in year 6 onwards and we are planning on saving to buy out the 20% as soon as we can.

Anyone who goes into the HTB without knowing what the costs are and how they will look when the interest hits is crazy.

You should work out if you can afford to pay the mortgage on the standard rate + interest on the HTB before you go ahead - its put black and white in front of you so there should be no shouts of miss selling.

Hey, an actual HTB user.
How refreshing after all the baseless scaremongering earlier in the thread.
Good luck with your purchase, Grezz!

MobileSaver

ChopperST wrote: »

For many of our friends this has also coincided with the wife / girlfriend reducing hours to go part time for childcare reasons, meaning some of them are stuck with their original mortgage provider's SVR as the reduced household income and the implications of the HTB repayment mean they cannot remortgage with a new provider due to affordability (further compounded by having 1 or 2 dependants where 5 years ago there were none).

It's hardly the fault of HTB that people decide to have children when they clearly can't really afford to!

ChopperST

MobileSaver wrote: »

It's hardly the fault of HTB that people decide to have children when they clearly can't really afford to!

Didn't say it was. Just highlighting an anecdotal situation. I'm sure the majority of borrowers are fully aware of what they are getting into and plan prudently. A small handful are probably going to get burnt.

Carl31

We used HTB, knowing what was at stake, it was all in black and white when we signed up

Our 2 year fix has just ended, and admittedly it has been a bit harder sorting the remortgage out due to the secondary charge, but we are moving to a lower rate 5 year fix now

By the time the 5 years comes we will have sizable equity plus an amount in savings to offset the government loan. I do look at some of our neighbours and wonder how they will cope though, theyre not high earners but are in quite expensive houses

lisyloo

will it turn into a full miss-sold type scenario?

Seems pretty clear that the answer to this is NO when everything is explained clearly in black and white.

Thrugelmir

ChopperST wrote: »

meaning some of them are stuck with their original mortgage provider's SVR as the reduced household income and the implications of the HTB repayment mean they cannot remortgage with a new provider due to affordability .

The advice for a long time has been to apply with your existing lender online. Then no advice is required which then requires affordability checks. No one should be stuck on the SVR as there are options available.

With a diminshed income/dependents affordability is always going to be issue. Not related to HTB per se. Affordability checks were the result of the mortgage review some years back. Shouldn't be a surprise to anyone now.

Malthusian

MobileSaver wrote: »

It's hardly the fault of HTB that people decide to have children when they clearly can't really afford to!

No-one said they can't afford to. They just don't qualify to save money on their mortgage by remortgaging to a cheaper rate. ChopperST didn't say anything about the SVR driving them to bankruptcy.

It may not have been the smartest financial decision ever made but 99% of people don't make the smartest financial decision, otherwise the MSE boards wouldn't exist. The point is that "sub-optimal" does not mean "unaffordable".

What were the alternatives? 1) Delay having a child for 3-5 years until they could afford a house outright: Unless ChopperST's female friends are 18-20 (highly unlikely) this is never risk-free, and it still isn't risk-free even if they are. 2) Have a baby in rented accommodation: Nothing wrong with that in itself, but bringing up children when you don't have security of tenancy is not ideal, and home ownership becomes an even more distant dream as the babber is highly likely to consume any savings for a good number of years.

kinger101

Rich2808 wrote: »

Once upon a time - in 2011. And not long after we got help to buy and a happy ever after for the big house builders and developers!
https://www.telegraph.co.uk/news/earth/hands-off-our-land/8754027/Conservatives-given-millions-by-property-developers.html

That's not really news though. Many companies hand money to both main parties. I was talking more about monies be directed to individual ministers rather than party coffers. The promise of non-exec directorship or consultancy posting once MP's parliamentary career has nosedived.

HPC_Ghuol_Hunter

Graham_Devon wrote: »

There isn't a link or a story as such, just a combination of stories since the interest rate rise last week.

We appear to be seeing an increasing pool of people, now stuck with HTB mortgages. The problem being, in the main:

- Can't re-mortgage due to the HTB element, so stuck on higher rate SVR
- Can't sell as house now not worth as much as they paid (new home premium)
- Interest rate increase alongside the loan fee's kicking in.

There are hundreds of "advisors" and "experts" now out there suggesting people didn't fully understand what they were getting involved in when buying under HTB.

Some of them are even suggesting the government should step in and help these people, either through an extension in the length of time before the loan payments kick in.... relieving them of negative equity by wiping off the same amount of HTB loan, and even lending to them directly on low rate fixed loans to get around the re-mortgage problems.

Developers on the other hand appear to be showing their appetite for the government to roll out even more flexible HTB options as prices are now higher and therefore, the pool of potential buyers, even with the loan, is reducing. one has called for the loan to be extended to 40% across the UK.

So things are starting to bubble - will it turn into a full miss-sold type scenario?

Everyone knows I have never liked HTB, so no need for those sort of replies.

As a civil society it is only right and just that we help the less fortunate who may struggle at times. Do you have an issue with that?

lisyloo

HPC_Ghuol_Hunter wrote: »

As a civil society it is only right and just that we help the less fortunate who may struggle at times. Do you have an issue with that?

It's depends why and what support you are suggesting.


Home ownership at the expensive of others is not a right.
Decent Shelter should be a basic right but that's different to asset ownership.


I am struggling to own a Ferrari - can you help?