bye 100% plus!

homer_j_3

I think the wider economy is worrying and mortgages/property market is pivotal in all of this. The country is run on credit. The question is that as a result of this credit becoming more expensive then the goods we buy become expensive.

How far will it go?

EdInvestor

homer_j wrote: »

I think the wider economy is worrying

Why? Retail sales were up in January, employment remains strong, interest rates are coming down, inflation is low, and although growth is slowing, recession is not likely.

By contrast, past downturns have been caused by rapidly rising interest rates and unemployment, often with high inflation as well.

Household assets net of debt are higher than they have ever been - it's not the case that the economy is run on credit, though I appreciate a mortgage broker could easily get that impression, looking at his client bank Repos are still at very low levels, and though there is more bankruptcy, that's because the law has changed dramatically since 20 years ago, no stigma any more.

We need to watch the situation in the US closely of course, but there's every reason to think we will escape the kind of problems they are experiencing - you only have to look at the big difference between the exposure of our big banks to the credit crunch compared with theirs to see that.

poppy10_2

Dan_Collins wrote: »

Ps. NR have officially got rid of the Together range!

Yes, let's get back on topic. This is big news, NR were at the forefront of offering these ridiculous loans. Now after Abbey, A&L, Coventry and Godiva also pulling out, the market in 100%+ mortgages has almost completely imploded.

I think Birmingham Midshires is the only lender left in this sector, and if they also pull out, all those currently on 125% deals face a very painful hike when they come to the end of their current fix periods.

EdInvestor

GavP wrote: »

.. don't a lot of BTLinvestors expand their portfolio by MEWing from their existing properties? If there are no capital gains and mortgage lenders are no longer offering high LTVs then I don't see how that can continue.

Some do, and they will be in for a period of slower expansion, which would be no bad thing as the investors who do this run the biggest risk of getting over-extended in a downturn.

Dan_Collins_2

Mortgage express may still offer it, although to get a client on that mortgage was hard work so they could lose it without blinking I imagine!!

Also this country is not completly run on credit, however it is an issue and needs to be watched. Bank rate will not go down much now, inflation is higher than wanted

Dan_Collins_2

Mortgage express may still offer it, although to get a client on that mortgage was hard work so they could lose it without blinking I imagine!!

Also this country is not completly run on credit, however it is an issue and needs to be watched. Bank rate will not go down much now, inflation is higher than wanted and as Ed says the US needs to be watched very closely. I currently belifve we are on a knifes edge, could fall either side.

Then again is depends on what paper you read!

granville_2

Some interesting comments here:
http://www.ft.com/cms/s/0/7ef6fe80-e0a1-11dc-b0d7-0000779fd2ac.html?nclick_check=1

"The problem with momentum in housing, as in equities, is that when it goes into reverse, the falls can be dramatic. In the US, a plateau in housing prices has been followed by a fall – the S&P Case-Shiller index is now down about 8 per cent from its peak. Meanwhile, this week’s data on housing supply showed continuing falls.

Meanwhile, there is every reason to expect the same phenomenon in countries like Spain and the UK which also have housing bubbles. In the UK, house prices seem finally to have run out of forward momentum. We know what happened next in the US."

As for the UK Economy, don't be believe the hype. Businesses (especially small ones) are hurting, personal debt the greatest it's ever been and the UK's current account deficit is at record levels. Nothing to be proud of and lots of economic indicators to be extremely worried about.

Of course you could believe the spin, but that would be burying your head in the sand.

ymmv.

ukwoody

Datasafe wrote: »

LOL I don't need a broker to find me a mortgage any more than I would need a broker to find me car insurance. :rotfl:

Then you'll probably pay well over the odds as you wont have all the facts available. You cannot trawl thru several hundred lenders AND know the criteria that many require, AND know who to contact if something goes wrong especially on low incomes or with unusal builds etc. Do you know what checks the solicitors should perform and the essential timescales the banks and societies have for drawing down the funds for your solicitor has to pay with? The solictor cannot just draw £100k from a bank to pay your seller. it has to be planned. Many times, my partner (Wanda) has had to help out a solicitor or remind them of various procedures - especially those who perhaps do not do much conveyencing.

My partner is an independent broker. She was formally a senior debt manager for a major bank. She has done this role for 6 years now. Why did she go into it? Because she genuinely wanted to help people get homes for themselves. Will she let someone borrow far inexcess of what they can afford? No, because she has seen first hand the heartache it causes.

Finacially, I seriously wish at times she still worked for a bank. She works about 60 hours a week, made herself very ill, for far far less money, and sometimes will worry herself sick trying to get the best deal for her customers after spending hours and hours on the phone or writing on their behalf.

IF you BOTHER to read Martins own comments on here, he actually RECOMMENDS the use of brokers.

Yes of course some brokers are dodgy, we have one not far from here. But dont tar them all with the same brush. Wanda had to study for exams and prove herself . She has a 50 - 60% personal refferal rate from customers, because she cares. She has advised many couples of the 70/30% subsidies scheme locally available for first time buyers - most of whom were totally unaware of it. She has saved many people thousands of pounds - and has boxes full of personal thank yous and cards to prove it.

Her income? Blo*ody cr*ap for what she does. I bet you earn more.

Don't blame Brokers for pushing up property prices. It has nothing what so ever to do with them. They are only the enablers.

I met Wanda trying to get a mortgage. I was going to be ripped off myself - and I thought I was pretty streetwise having had 3 mortgages before. I had just got divocered, my ex-partner had not been paying the mortgage - unknown to me, and I had just gone self employed.

I do not gest when I say Wanda not only got a me fantastic mortage, saving me 4% over the so called good deal I had been offered, she personally contacted a major lender and persuaded them to give me a standard mortgage - all before I went out with her. I could not have doen that and would not have a house today without her knowledge as a broker.

To say brokers dont earn their money is to be completly nieve and arrogant about the whole business. Many of them are passionate, dedicated, honest and commited - very often for little or no thanks.

Wanda HAS to keep ontop of who, is offerring what, to whom, on what critera. And that applies to every decent broker out there, and in these times when things are getting harder, it is the broker who will often save the day. It is a FACT, that banks and finacial lenders could not cope without brokers within the industry. Go into most major banks and say to them you want to borrow 200k from the Ecology BS, or Buildstore if you are self building and see what they have to say then.

Woody

Gorgeous_George

Datasafe wrote: »

LOL I don't need a broker to find me a mortgage any more than I would need a broker to find me car insurance. :rotfl:

But you need a shopkeeper to find you a tin of beans.

I think that applicants should need an NVQ in financial managment before they can qualify for a mortgage.

GG

PosterBoy77

homer_j wrote: »

I think the wider economy is worrying and mortgages/property market is pivotal in all of this. The country is run on credit. The question is that as a result of this credit becoming more expensive then the goods we buy become expensive.

How far will it go?

Things need to go back to where debt levels are sustainable and the average person is saving a bit of money. This means we are in for a huge correction in our economy, and it needs to be welcomed. The position our economy is in now cannot be maintained period. As a country we will have to start living within our means again, but it could come as a bit of a shock to us all, as our economy is probably the most hollow in the developed world.