Monday, Apr 21, 2008
In the words of Confused76....MUAHAHAHAHA
Times Online: Abbey pulls out of buy-to-let mortgages
''...Abbey has stopped selling buy-to-let mortgages to landlords, blaming "recent market moves" for a raft of measures announced today that will also penalise some residential borrowers. ...''
Posted by hpwatcher @ 04:25 PM (1430 views) Add Comment
36 Comments
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1. mark wadsworth said...
Just had a call from Her Indoors - our landlady (who's coming off a two-year fixed rate in July 2008 - she bought about 2 years ago) wants to come round this weekend 'for a chat'. As she doesn't have to give notice for another month ...? Does anybody know what sort of interest rate hike she's looking at? I happen to know that our rent just covers her existing monthly payments.
2. jack c said...
The Times article isnt quite accurate because the withdrawal is in relation to intermediaries only -
NOTE - A spokesman for Abbey says: "We are still maintaining a buy-to-let option although this is through the direct channel only. The temporary withdrawal in the intermediary channel is to ensure we maintain high service levels on our core residential lending.
None the less this is a BIG blow to the BTL brigade.
3. confused76 said...
HPW
great post!
let me give you my personal, heartfelt spin on this subject... ready? one, two, three, all together...
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
MWAU HAHAHAHHA HAHAHA HAHHHAHHAHA HHAHH HAHAHH AHHA HAHAHHAHHAHHAH
4. justwatching said...
Mark, make sure you ask for a reduction in rent. Your cost of living has gone up recently.
5. uncle tom said...
mark,
I believe the most popular BTL deal 2 years ago was at 5.6%
Unless your landlady was only modestly mortgaged at the outset, she'll probably be looking at an SVR of about 6.75% if she's lucky - it depends who she's with.
What do you reckon your house was worth when she bought it?
~~~
Now, should we open a book on how long it will be before there are no more BTL deals available to new borrowers?
6. letthemfall said...
Or tell her that rents are plummeting - oversupply, wage crunch, people waiting for rents to fall before they rent...etc
7. uncle tom said...
jw said:
"Mark, make sure you ask for a reduction in rent. Your cost of living has gone up recently"
Yes, I'd get that in before she tries to pass on the increase in her mortgage payments!
8. jack c said...
Mark W - obviously you have provided a limited amount of info but assuming LTV of less than 75% and everything else stacking up (rental assement etc..) the most competitive BTL rate is 5.44% fixed but it comes with a £3800 fee !
More realistic rates with reasonable fees are in region of 6.5% to 7.7%
9. tyrellcorporation said...
Talk about hard times, I've just been asked to pay £975 a month on my rented 4 bed house (worth apparently £335k), that's an increase of £25 a month and the first rise for 2 years. Shocking I know.
So much for rocketing rents eh? the mortgage on this would no doubt have risen by about £150 a month if I owned it.
10. confused76 said...
"Brokers said that the changes were a sign that rate rises were likely to continue, despite expectation's that the Government's £50 billion asset-swap facility will be available from next Monday."
AH HAHHAH AHHAHHAHAHHHAHHAHAHAAHHAHHHAH AHAHHAHAHHAHAHHAH HAHHAHAHHA
Darling Darling!!!
11. yorkshireman said...
hpcwatcher - infringement of copyright I think. Sue away C76.
12. confused76 said...
Never seen such concerted effort of the greatest minds in our government and the BoE sink faster than this morning's BAILOUT
MWAU HAHAH HAHAHHAHAHHHAHHA HAHAHAHHAHHH
£50bn...?? Try £500bn next time
13. confused76 said...
Not suing, but would appreciate a cheque in the post... :))
14. General Melchett said...
500 billion isnt going to cut it.... As pointed out elsewhere in the blog todday, 690 trillion should just about cover it though. No anyone with that sort of readies they can give to the spivs? No? Thought not......
15. crash n burn said...
Anyone out there got access to realtime BoE / LIBOR rates? If so - what's happening?
16. mark wadsworth said...
Thanks for info, everybody above.
On the basis of a 5.6% fixed-rate coming to an end, she had an 80% mortgage when she bought it. So if her rates go up by 1% or so, she's making an actual cash loss of £500 every month. Hmmm. That's the sort of thing that would encourage me to sell, if I were in her position.
17. techieman said...
Mark, since Greenbay is always banging on about property forever maybe he can take up the slack and buy her portfolio. Hey how 'bout it Greenbay?
Crash - shrt sterling futures for June show 9440 barely changed lately but down from 9500 on 22nd jan. I.e.now discounting 3 months LIBOR for June delivery at 5.6%. Looks on the charts like some more downside (rates rise) to me.
18. taffee said...
crash
go to www.bankofengland.com
19. techieman said...
no tafee its .co.uk
see http://www.bankofengland.co.uk/mfsd/iadb/FromShowColumns.asp?Travel=NIxAZxI3x&FromCategoryList=Yes&NewMeaningId=RILR3M&CategId=6&HighlightCatValueDisplay=Interbank%20lending%20rate%20%203%20month%20mean%20LIBID/LIBOR
20. crash n burn said...
Thanks guys - guess I'll have to wait till tomorrow to get the EOD data.
21. Orwell said...
Greenbay?.... Greenbay?.... Greenbay? calling Greenbay....
I think well you know best not talk about it, the bailiffs and all that?
22. 51ck-6-51x said...
Mark - check your contract she may only be able to raise rates by a set maximum (e.g. the greater of 3% or RPI). I would suggest looking at competing rents in your area aswell as this may give you more leverage for a drop (i.e. saying that you could move out and get a reduced rent, and that she will not be able to find a tenant even at the current rate she is charging!) - especially if you live somewhere like Leeds city centre.
Crash n Burn - LIBOR only updates once a day @ 11:30
For sterling today's curve is:
{
Overnight = 5.08125
1 Week = 5.12
2 Weeks = 5.25
1 Month = 5.49
2 Months = 5.73313
3 Months = 5.885
4 Months = 5.8825
5 Months = 5.87813
6 Months = 5.87125
7 Months = 5.86
8 Months = 5.85125
9 Months = 5.84125
10 Months = 5.83125
11 Months = 5.82188
1 Year = 5.80813
}
The BoE Base rate only updates at MPC meetings or as an emergency measure - it's 5% right now.
23. hpwatcher said...
hpcwatcher - infringement of copyright I think. Sue away C76.
No, I think I am well within the copyright laws. It was a quotation for educational purposes and falls well within the terms of 'fair use'.
24. it_is_going_with_a_bang said...
mark w
I would think she wants the chat to tell you that she is selling up. Anything else I would imagine a letter would have done.
She probably wants a favour from you, i.e. allow her to sell it with you in it so that she doesn't lose months of rental money worth thousands of pounds to her and for you to agree to move out just prior to sale.
I can't really think of any other reason that that to be honest.
Get back with the answer though - intrigued now!
25. mark wadsworth said...
IIGWAB 22, that's my first guess as well. If she wants to sell it with sitting tenants, that's fine by me, every month she'll drop her price expectations by a few thousand, but the market value will fall just that little bit faster, we'll still be here for ages. Fingers crossed, touch wood etc.
26. who stole my pension? said...
Perhaps she wants to sell with you staying in it - look buyer, good property with tenant already! Sounds like a good opportunity to ask for a reduction in rent!
Also when she comes have your computer on showing this site http://www.nestoria.co.uk/ . This will show you all the propertys to rent in the area.
Anyone want to guess how long it will be before the term BTL goes the same way as Betamax?
27. uncle tom said...
If she wants to sell with a sitting tenant, she will want to show what a good rental return the property is making - so she might ask you to accept a much higher rent in return for nice brown envelopes of ready folding...
28. greytornado said...
"25% deposit to qualify for cheapest deals" - this is epic stuff of the first magnitude - Building Societies have never before asked for such huge deposits for normal borrowing. Back in the good old days of sensible lending, Building Societies as a generalisation would do 90% on older property & 95% on newer stuff. 25% deposits mean that the Abbey are thinking that a 25% reduction in house values is possible. The B of E are obviously now thinking that up to 30% is now possible - see other articles today. Hold on to your hats - this is going to be like the Titanic on its way to the sea bed - a long way down.
29. mark wadsworth said...
WSMP, that's a good site, thanks. UT, we'll see how fat the envelope is!
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