Next recession - poll

AKRev01

Very optimistic!

phillw

Malthusian wrote: »

If you visit a mortgage adviser then you're applying, not being sold to.

If you go to a mortgage adviser and they give you advice which means you choose the wrong product then you can complain about misselling. It would be strange to that you can be missold something you won't sold.

Thrugelmir wrote: »

Never a need to. Managing personal financial affairs well was drummed into me from an early age by both my parents and grandparents.

What is it you think mortgage advisers do? Not everyone needs to go to an adviser, but a lot of people benefit from it.

I didn't particularly and only went because the sellers supposedly weren't going to take the house off the market unless I did. The rules were different then, because the advisers got their fee from the commission. It's changed now and no longer free, so I didn't bother when I changed deal.

But a friend of mine got a set of mortgages over three properties, which they couldn't have got on their own.

Thrugelmir

phillw wrote: »

I
What is it you think mortgage advisers do? Not everyone needs to go to an adviser, but a lot of people benefit from it.

Never used to be the case. Result of a combination of factors. Myriad of products now available, lenders using brokers to source (and in the process initially vet applicants) and lastly greater regulation. Lenders have been able to remove front line staff and place them collectively in larger processing centres. Where they are far more productive and efficient. Of course technology has played a major part in enabling this in the past 20 years or so.

phillw

Thrugelmir wrote: »

Never used to be the case. Result of a combination of factors. Myriad of products now available, lenders using brokers to source (and in the process initially vet applicants) and lastly greater regulation.

What it has always come down to is if you look like the type of customer that the mainstream lenders want then you probably don't need advice.

Someone I know who benefited wanted to buy after going from self employed to going into partnership with others they were working with who were also self employed, they all became a director of the company.

Maybe in the distant past they would have spoken to their friendly building society manager who would have personally approved it. We don't live in those times anymore.

Once you ask for advice on the best mortgage for you, then you're being sold a mortgage. https://www.mortgagestrategy.co.uk/missold-mortgage/

Malthusian

phillw wrote: »

If you go to a mortgage adviser and they give you advice which means you choose the wrong product then you can complain about misselling.

The starting point was Thrugelmir's contention that IO mortgages weren't missold in anything like the same numbers as PPI policies, therefore we shouldn't expect to see the same number of complaints uphold and compensated.

Virtually no-one would have bought PPI if it hadn't been sold to them but people would have taken out interest only mortgages.

If there were good reasons for recommending an IO mortgage then it isn't a missale. In the majority of PPI sales there were no good reasons for recommending it.

There will be no mis-selling refund bonanza on IO mortgages. People who come to the end of IO mortgages with no ability to repay will either have to sell or be moved onto pensioner / lifetime mortgages.

Anyone who thinks the Ombudsman is going to give them a free house after they've lived close to rent-free in it for however many years is delusional. Even if a complaint was upheld the Ombudsman would consider how much they have actually lost by getting to live in a house for however many years while paying much less than they would in rent.

Thrugelmir

Malthusian wrote: »

The starting point was Thrugelmir's contention that IO mortgages weren't missold in anything like the same numbers as PPI policies, therefore we shouldn't expect to see the same number of complaints uphold and compensated.

Virtually no-one would have bought PPI if it hadn't been sold to them but people would have taken out interest only mortgages.

If there were good reasons for recommending an IO mortgage then it isn't a missale. In the majority of PPI sales there were no good reasons for recommending it.

There will be no mis-selling refund bonanza on IO mortgages. People who come to the end of IO mortgages with no ability to repay will either have to sell or be moved onto pensioner / lifetime mortgages.

Anyone who thinks the Ombudsman is going to give them a free house after they've lived close to rent-free in it for however many years is delusional. Even if a complaint was upheld the Ombudsman would consider how much they have actually lost by getting to live in a house for however many years while paying much less than they would in rent.

Worth remembering also that there was an incentive to sell PPI policies. They were often a grossly overpriced product. I know of one such product that was sold through main car dealer networks. The gross commision rate was around 35% of the premiums paid. Dealers were able to juggle the new car selling price knowing that there would a kick back on their share of the PPI sale to compensate. Thereby offering what appeared to be an attractive package.

Likewise HBOS staff were set selling targets for PPI policies on personal loans. Those that poor sales would arrive in the office to find a cabbage on their desk.

Mortgages suffered from liars loans etc. However applicants were party to the fraud. Making a claim for misselling rather difficult. Nor at the time did lenders operate outside of regulatory guidelines. Such as were introduced under the Mortgage Market Review, (MMR).

Brown_Bear

michaels wrote: »

One elephant in the room imho is the pension auto-enrolment. Although this doesn't show up as lower incomes, effectively spending power is being taken from consumers, guess it is then spent buying assets such as shares and thus the sellers of these assets in theory have more to spend but I bet their average propensity to consume is lower than that of the average earner who is losing income.

Probably true - if those who are selling shares are buying bonds (ie via their pension fund adjustments as they age).

Brown_Bear

Thrugelmir wrote: »

Worth remembering also that there was an incentive to sell PPI policies. They were often a grossly overpriced product. I know of one such product that was sold through main car dealer networks. The gross commision rate was around 35% of the premiums paid. Dealers were able to juggle the new car selling price knowing that there would a kick back on their share of the PPI sale to compensate. Thereby offering what appeared to be an attractive package.

Likewise HBOS staff were set selling targets for PPI policies on personal loans. Those that poor sales would arrive in the office to find a cabbage on their desk.

Mortgages suffered from liars loans etc. However applicants were party to the fraud. Making a claim for misselling rather difficult. Nor at the time did lenders operate outside of regulatory guidelines. Such as were introduced under the Mortgage Market Review, (MMR).

So who have been the losers in this whole PPI refund bonanza?
Those who own shares in the banks affected?

Brown_Bear

Crashy_Time wrote: »

I don`t have an opinion on house prices priced in gold, .

Why not?
I would say it's the best historical measure.

Thrugelmir

Brown_Bear wrote: »

So who have been the losers in this whole PPI refund bonanza?
Those who own shares in the banks affected?

Indirectly many people will have held/do hold bank shares as part of their pension pots.