Wednesday, Dec 12, 2007
Even renting is getting more expensive...
Press Association: Homelessness warning over mortgages
[Stupid] people on low incomes are being encouraged to take out mortgages they cannot afford, leaving them deep in debt and facing the prospect of homelessness, a report has warned.
Citizens Advice said dubious advice from brokers, irresponsible lending decisions and aggressive arrears management by sub-prime lenders was driving the current increase in arrears and repossessions.
It said many lenders and brokers had failed to carry out basic checks to ensure that borrowers would be able to meet repayments.
Posted by little professor @ 08:03 AM (574 views) Add Comment
4 Comments
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1. little professor said...
Sorry, wrong title for the article.
Anyway:
"C.A.B. said most people seeking advice on these issues were on low incomes, more than a third of whom had incomes below the UK poverty line, while one in five were reliant on means-tested benefits. Around 70% of these people (who tended to have borrowed from sub-prime lenders at higher rates of interest) also had outstanding unsecured debts averaging £22,000. [no doubt spent on Sky+, PS3s and buying new cars from the local friendly loan shark]
2. Orwell said...
Don't be judgemental! You never know when you may be in that position!
Though it is worrying that the CMLR reckon ony 57k repossessions next year. Allowing for 20% in built overoptimism the figure is likely to be 65k and that is worrrying high to the (claimed?) high of 75k but without even a recession or the unemployment that might be lurking in the background...
3. cornishman said...
little professor: I reckon that most of the unsecured debts these people have is probably to pay the interest on their sub-prime mortgages, given that a lot of them have a very low income.
What is interesting is that it was only a few months ago we were all being told that there was no sub-prime lending in the UK, it was only those 'silly' americans that had lent money to people with no income to speak of. How quickly things have changed.
4. Kingkong said...
What happend to common sense ? - FSA regulators aren't they supposed to make sure that things like this won't happen in the first place. Stockbrokers and fincial advisors are regulated to the finger prints. What about mortage brokers and ESTATE AGENTS ???
Surely the government has to be held responsible for this disaster