To buy or not to buy?

itsnever2lateisit?

ABN wrote: »

Taken from various posts by Penny Racer


Wish someone would lend me £48k INTEREST FREE whilst having money in the bank.

While SquateFrees post was technically incorrect morally I agree with it.

In the second line of the quotes notice the OUR DEBTS which would seem to imply that they have move joint debts to a single person who can’t afford to pay but the other can. That would, on the face of it, seem like at worst fraud and best morally reprehensible.

I do have sympathy for those who get into debt and can’t afford the repayments but not for those, who as a family, can afford to repay.

It effects all of us and should not be condoned imho.

Playing devils advocate for a mo

The OP & her OH are in MoD accomodation, so presumably the OH is in the military, who dont take to kindly to debt as it opens them up to blackmail. So if there in no financial association (nor ever has been) between them in regard to the debts you can say thats astute financial planning

*gets coat*

SquatNow

ABN wrote: »

While SquateFrees post was technically incorrect morally I agree with it.

In the second line of the quotes notice the OUR DEBTS which would seem to imply that they have move joint debts to a single person who can’t afford to pay but the other can. That would, on the face of it, seem like at worst fraud and best morally reprehensible.

I do have sympathy for those who get into debt and can’t afford the repayments but not for those, who as a family, can afford to repay.

I feel my original post was correct but can't confirm that without the full financial details.

IIRC "full and final settlement" and IVA are very similar, except that an IVA groups all your debts together as treats all your creditors as one entity. AFAIK it is to prevent the following cicumstances:

• you owe 20k to each of 5 banks, totaling 100k.
• you have 75k
• you contact each of the banks and ask then to take 15k as "full and final settlement"
• each band is then in a race to sue you for the full amount
• 3 banks get the full 20k, one get 15k and one gets nothing

IVA is a fair way to sort it out without going to court.

No bank will offer you a reduced "full and final settlement" if you have enough cash or assets to pay them back. (Remember, under the new rule (from april 2006) all loans are effectively secured on your proprety!)

The only reason they settle for less is that you have proved how much you can/cannot pay, so there is no point spending the legal costs of going to court, and because the cost of collecting the money over an extended period is greater than the outstanding debt. It's not because they are feeling charitable, it's the banks cutting their losses.

If you can cover most of the debt they might do a "full and final settlement" deal... but few banks would do it if you were only offering half, and none would offer it if they knew you could repay in full. Under no deal would you end up holding a large amount of money at the end... they'll want whatever you have! They're a business afterall, not a charity.

It may be that the OP has debts and assets in different names (husband/wife) in which case it's legal but totally immoral, or the OP may be committing fraud. Unless he/she is prepared to open up all their finances to us we'll never know. It's worth noting that when banks lend to a married person they do so on the basis that both will be paying the loan... the old "what's mine is yours" rule. (Not sure of the legal point on this though... is a husband liable for his wifes debts???)

From the way the OP described it originally, it was fraud, and I'll stand by my original post. You may have grouped together and openly chastised me, but just because the OP has a sob story it doesn't make them a good person... the could still be behaiving immorally or illeagly.

Posters should be open to multiple opinions, else forum becomes faschism.

Running_Horse

lieutenant_dan wrote: »

there's been so much credit recklessly thrown at people in recent years, that some of these companies can have little or no complaints if people end up drowning in debt and unable to pay it back

Although companies should be restricted from chasing loans they never should have made, whatever happened to personal responsibility? There are loads of nice things we would like to buy for our new house and baby, but we bin the credit leaflets, and save up until we can buy it with cash. We could easily borrow £48,000 or more, but choose to live within our modest means.

OP. Here is one scenario if you do this. You tie up your £26,000 capital indefinitely, make a monthly loss on the repayments, find yourself having to sell the house in a couple of years for a £26,000 loss if the market falls, and once you add in estate agent and solicitor fees, you have added to the original debt you wanted to clear.

It really doesn't make sense.

How about selling your existing BTL before prices drop? You could then either clear your debts, or invest in a money making business like a shop. You would be surprised how cheap they can be to buy. This could also provide a long term career for when hubby leaves the forces.

paulrn_2

having read that your husband is in the forces, heres a thought, sell the BTL clear the debts before he gets a security check and fails it for financial insecurity, move into quarters if he has long enough left and save.

Romani_Ite_Domum

Running_Horse wrote: »

Although companies should be restricted from chasing loans they never should have made, whatever happened to personal responsibility? There are loads of nice things we would like to buy for our new house and baby, but we bin the credit leaflets, and save up until we can buy it with cash. We could easily borrow £48,000 or more, but choose to live within our modest means.

OP. Here is one scenario if you do this. You tie up your £26,000 capital indefinitely, make a monthly loss on the repayments, find yourself having to sell the house in a couple of years for a £26,000 loss if the market falls, and once you add in estate agent and solicitor fees, you have added to the original debt you wanted to clear.

It really doesn't make sense.

How about selling your existing BTL before prices drop? You could then either clear your debts, or invest in a money making business like a shop. You would be surprised how cheap they can be to buy. This could also provide a long term career for when hubby leaves the forces.

Great constructive criticism Running horse.
Sense between the ridicule and group hugs.

Guy_Montag

Back on topic - why not stick it into something like this:

http://www.askbm.co.uk/savings/t/fixed/product.asp?id=106

while you decide what to do. You'll have a nice bonus of £350 come February.

I think the general consensus is that BTL is a bad idea for you & there are better options. Try hanging about the savings & investment boards to pick up some tips, or think about options for retraining/setting up a business.

tigtig

SquatNow wrote: »

What the OP is proposing is simply fraud and could land him in jail.

The deal he is trying to do on the debts is effectively an IVA. He obviously hasn't told the lenders about the £26k and has instead told them he is broke, hoping they will beleive him and write off half the money. In fact, from what he says, he has £26k plus enough (£24k) to pay half the debts... so he could pay them off entirely.

He's basically just a con artist.

PennyRacer: You are legally obliged to pay the lenders their money. If you deliberately take actions to defray them you can go to PRISON. In this sort of situation the judge will look on you with distain as the offence would be both willful and with mallice. Pay off your debts. The money lent to you ultimately comes from honest savers. STOP TRYING TO DEFRAUD HONEST MSEers.

Mods: As an offence has quite clearly taken place, surely you are legaly (and morally as the victims will ultimately be the kind of saver who is on here trying to find ways to save a bit of money) obliged to report it to the police and supply the OPs IP Address???

Kick, Ban, Report.

HAHAH Who is this guy, christ you do talk a load of old toss..... Perhaps you should start living in the real world you strange little person and stop scaring people.

It looks like taking advice from you would be like counting all the grains of sand on a beach, POINTLESS. Very uneducated

This lady would like some advice, not a kicking from you.

immortalbeast

Squat , ive never heard such rubbish.

Dont talk about stuff you obviously dont know anything about. An IVA is monitored by a formal practioner and is a legally binding agreement. And they WOULD accept less than 100% of the amount as i have debts and have 5 of my 12 creditors who are willing to accept 40%. So stick that up your pipe and smoke it Mr Squat(know f****all)

Matt

SquatNow

immortalbeast wrote: »

Squat , ive never heard such rubbish.

Dont talk about stuff you obviously dont know anything about. An IVA is monitored by a formal practioner and is a legally binding agreement. And they WOULD accept less than 100% of the amount as i have debts and have 5 of my 12 creditors who are willing to accept 40%. So stick that up your pipe and smoke it Mr Squat(know f****all)

Matt

Matt, yes if you couldn't afford to pay and didn't have any assets then that's correct.

But not if you had twenty six THOUSAND POUNDS they wouldn't.

Where on earth do people get the idea that they can walk away from their debt sand still keep all their money? I think this is part of the problem! If you can pay a debt, the banks will persue you until the ends of the earth to get their money back. They will only write off part of the money if they think you can't pay it and that it will cost them more than the outstanding amount to recover it.

There is no-way anyone could come out of an IVA or ANY debt reduction agreement with a group of lenders with £26k in their pocket. You just can't! The only way it could happen would be if you lied and said you had no money and they didn't find out about it.

So many people are openly attacking me but no-one will address the point: Banks wont write off your debts if they know you have the funds to pay them.

The bile being spat at me is disgraceful. I made an accusation and then backed it up. I added caveats and showed why I beleived the accusation to be true, and in return I've had nothing but a stream of insults backed up with nothing but bluster, none of which have in any way showed what I've said to be untrue.

fc123

Running_Horse wrote: »

It really doesn't make sense.

How about selling your existing BTL before prices drop? You could then either clear your debts, or invest in a money making business like a shop. You would be surprised how cheap they can be to buy. This could also provide a long term career for when hubby leaves the forces.

NO!!! Don't take on retail premises at this moment in time...this is one area that I AM "Expert" .......they are the next "boom" moneymaking machine to go down. Trust me!

Pay the £26k off the debt...Flog the BTL and put any profit off the debt....keep on at the remainder and SAVE ...you can buy another house / BTL in 5 yrs time.
The relief you will feel when the debt is gone will be fantastic!