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Sybil13

I Ask Once Again Where Is The Money Going To Come From For Mortgage Lending ?

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Might make myself look like the "bear of little brain" that I am but seems worth asking this Q again.

If the Times is saying today that the additional QE will be used to "ease the supplyof working capital finance to businesses"

Bank Broadens £125bn scheme to help business

In an apparent concession to critics, the Bank said it would expand its Asset Purchase Facility, under which it is buying £125 billion in corporate and government bonds so that it could purchase a wider range of commercial paper — short-term corporate debts — with a view to easing the supply of working capital finance to businesses.

The Bank said it would publish a consultation paper on a new "Secured Commercial Paper Facility", which would allow it to buy up assets including guaranteed funds owed to companies by their creditors.

The Bank will also consult on a separate "Supply Chain Finance Facility", which it outlined this morning, which would aim to provide working capital to suppliers of significant companies

So where will the money come from to help mortgage lenders?

The past few weeks we heard from the BOE:

The Bank of England is concerned that the UK's banking system is heading for a third wave of crisis that could snuff out fragile signs of recovery in the economy.........

......Continued weakness at these banks may prevent the increase in lending that ministers are desperate to see, and dash hopes of a pre-election recovery for Labour.

The Bank of England is also worried that continued stresses in the global financial system will suck money out of the UK as cash-starved international banks bring money back home. Foreign banks are thought to be withdrawing funds from Britain once loans expire, rather than roll them over.....

The Government must consider pumping more cash into struggling British banks and conceivably nationalise more of them, or consign itself to years of insipid growth, the Bank of England Governor has warned

Mervyn King said although banks' survival had been assured by recent bail-outs, they would not start lending freely unless more capital was pumped into their balance sheets.

Mr King said: "There is a big difference in practice between the levels of capital banks need to be stabilised... and those required to persuade banks to exhibit normal levels of risk-aversion. How big that gap is is impossible to say... but it looks as if it will be quite big.

If the banks are going to continue as private sector entities they will naturally behave in a risk-averse way for a while... [The state] could put in more public sector capital but that has ramifications for the Governments' shareholdings in banks."

Then we have been told that , "Mutuals are no longer as safe as houses":

Britiain's building societies face up to the prospect of losing capital as a result of changed credit status and must adjust to the new reality

...........I believe the problems at the Dunfermline will soon be mirrored by similar difficulties at societies... No other society can swallow other bad balance sheets whole, so in future there will be no mergers ... taxpayers will take the strain of ensuring the survival of the building society movement.â€

To ensure those survive, the Treasury is planning some form of lifeboat to help societies rebuild capital. The Budget Red Book hints at the plans, saying the Government is taking “actions relating to the development and design of capital instruments and the potential for shared services between mutuals

Despite being skewed towards more secure retail deposits, 30pc of the sector’s funding – or around £100bn – comes from institutions, who may think twice following the Moody’s downgrade, and the wholesale markets, which remain effectively closed. Without funding, mortgage lending will dry up. “To the extent that funding is restricted, it will restrict our ability to lend,†Nationwide chief executive Graham Beale told the TSC. The BSA’s Adrian Coles reckons “it is quite conceivable that lending will fall this year†as funding evaporates. .............With rates at almost zero, savers are moving their money into different investments and societies suffered overall

So if the QE expansion is for busiinesses then where will the money come from for increased mortgage lending?

I have asked and asked if this is why the BOE and CML have both said "the green shoots have no roots"?

Last week commenting on the lending data from the Bank of England, CML economist Paul Samter observed:

"It looks almost inevitable that May approvals will be higher than a year ago for the first time since early 2007. However, activity remains at extremely low levels on any historic comparison – and weaker than at any point in the early 1990s. Limited lending capacity and the impact of further job losses are likely to act as a ceiling for how far the improvement can continue, although there could be further modest rises in the coming months."

LIMITED LENDING CAPACITY - CEILING FOR HOW FAR THE IMPROVEMENT CAN CONTINUE.

Mortgage lending as you know is already down nearly 2/3rds on 2007 levels so where can the money come from to support anything other than house price falls?

Edited by Sybil13

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Might make myself look like the "bear of little brain" that I am but seems worth asking this Q again.

If the Times is saying today that the additional QE will be used to "ease the supplyof working capital finance to businesses"

Bank Broadens £125bn scheme to help business

So where will the money come from to help mortgage lenders?

The past few weeks we heard from the BOE:

Then we have been told that , "Mutuals are no longer as safe as houses":

So if the QE expansion is for busiinesses then where will the money come from for increased mortgage lending?

I have asked and asked if this is why the BOE and CML have both said "the green shoots have no roots"?

Last week commenting on the lending data from the Bank of England, CML economist Paul Samter observed:

LIMITED LENDING CAPACITY - CEILING FOR HOW FAR THE IMPROVEMENT CAN CONTINUE.

Mortgage lending as you know is already down nearly 2/3rds on 2007 levels so where can the money come from to support anything other than house price falls?

Obvious, init, there isnt any. there wasnt any.. there hasnt been any for the last 2 years or so.

UK banks are net borrowers. they need others to keep lending to them or they do a Kaupthing PDQ. QE is to keep the banks alive without lending them any more. course, the QE costs nothing TODAY, so borrowing to carry out the op is lept to just Astronomic, rather than Galactic levels

WE will pay the price next year, and the next and the next.....if we have anything to eat that is.

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Obvious, init, there isnt any. there wasnt any.. there hasnt been any for the last 2 years or so.

UK banks are net borrowers. they need others to keep lending to them or they do a Kaupthing PDQ. QE is to keep the banks alive without lending them any more. course, the QE costs nothing TODAY, so borrowing to carry out the op is lept to just Astronomic, rather than Galactic levels

WE will pay the price next year, and the next and the next.....if we have anything to eat that is.

So do you recommend people go out and buy a small well insulated property with a large garden (growing food) and close to woods (for fire) .....even if it is only 20% off peak because even if it could be bought 50% cheaper by next year the money will be worth nothing?

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So do you recommend people go out and buy a small well insulated property with a large garden (growing food) and close to woods (for fire) .....even if it is only 20% off peak because even if it could be bought 50% cheaper by next year the money will be worth nothing?

no, I like to rent, I have a very large place now at £10 per week more than my last well insulated place. market value around £400K. Life is good.

If others want to "invest", thats up to them. I offer no advice. Although a nice cuppa would be appreciated. no milk, no sugar...thanks

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no, I like to rent, I have a very large place now at £10 per week more than my last well insulated place. market value around £400K. Life is good.

If others want to "invest", thats up to them. I offer no advice. Although a nice cuppa would be appreciated. no milk, no sugar...thanks

Hey Bloo Loo - enjoy your weekend as a bull? ;)

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Might make myself look like the "bear of little brain" that I am but seems worth asking this Q again.

If the Times is saying today that the additional QE will be used to "ease the supplyof working capital finance to businesses"

Bank Broadens £125bn scheme to help business

So where will the money come from to help mortgage lenders?

The past few weeks we heard from the BOE:

Then we have been told that , "Mutuals are no longer as safe as houses":

So if the QE expansion is for busiinesses then where will the money come from for increased mortgage lending?

I have asked and asked if this is why the BOE and CML have both said "the green shoots have no roots"?

Last week commenting on the lending data from the Bank of England, CML economist Paul Samter observed:

LIMITED LENDING CAPACITY - CEILING FOR HOW FAR THE IMPROVEMENT CAN CONTINUE.

Mortgage lending as you know is already down nearly 2/3rds on 2007 levels so where can the money come from to support anything other than house price falls?

Sybil your posts are good, but is there any chance you could put an "Executive Summary" at the top of each one?

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no, I like to rent, I have a very large place now at £10 per week more than my last well insulated place. market value around £400K. Life is good.

If others want to "invest", thats up to them. I offer no advice. Although a nice cuppa would be appreciated. no milk, no sugar...thanks

I like my tea the same way , no milk , no sugar , no bull**i* and please no sympathy!

Out looking for some shoes with mirrors on and looking forward to a time when you become PM even if only for a day!

Edited by Sybil13

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Sybil your posts are good, but is there any chance you could put an "Executive Summary" at the top of each one?

?????? a WHAT? Ho hum where are my pots of honey?

Living on the W.Coast of Ireland currently nothing very "summery" over here but there are a few people on HPC I might not mind "executing" if I wasn't trying to practice loving kindness :)

Edited by Sybil13

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Might make myself look like the "bear of little brain" that I am but seems worth asking this Q again.

Mortgage lending as you know is already down nearly 2/3rds on 2007 levels so where can the money come from to support anything other than house price falls?

And I shall do likewise.

Say I borrow 200 grand from the Nationwide they have got from savers. That money goes from the Nationwide into the Solicitor's bank account, then is split between the vendor's bank account and the vendor's mortgagor's bank account. Let's say the vendor has his mortgage and savings with Nationwide. So Nationwide have now got another 200 grand to lend out. 

Repeat until market overheats again.

Or I could say that only 25% of the mortgage market was financed by securitisation and only 50% of the housing market was mortgages. So once prices fall 12.5% there's enough money left to finance that.

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I like my tea the same way , no milk , no sugar , no bull**i* and please no sympathy!

Out looking for some shoes with mirrors on and looking forward to a time when you become PM even if only for a day!

w...w.w...ww...well, I am just getting on with the job, which is the right thing to do.

My trip to Bull-land was interesting....I hope my defence of the Bullsphere was as good as the best of them.....it helps to understand the opposition if you really do put yourself intheir shoes...shame the site was so slow all weekend or I could have really enjoyed a proper bull debate.

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So where will the money come from to help mortgage lenders?

Well Sybil, Britannia don't appear to be having any problems. 90% LTV just introduced. Reasonable rate at 5.09% and just £599 fee.

Maybe you're a tad too pessimistic.

Sybil your posts are good, but is there any chance you could put an "Executive Summary" at the top of each one?

Good, but you don't necessarily want to read an entire post. :D

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He'll print it for houses

He'll print it for shops

He'll print it for chavs

He'll print it for jobs

He'll print it for you

He'll print it for me

Trust good old Gordon

Just wait and see

Edited by eightiesgirly

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no, I like to rent, I have a very large place now at £10 per week more than my last well insulated place. market value around £400K. Life is good.

If others want to "invest", thats up to them. I offer no advice. Although a nice cuppa would be appreciated. no milk, no sugar...thanks

If you owned the house outright you'd pay no rent. Wouldn't that make life even better?

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Well Sybil, Britannia don't appear to be having any problems. 90% LTV just introduced. Reasonable rate at 5.09% and just £599 fee.

Maybe you're a tad too pessimistic.

Good, but you don't necessarily want to read an entire post. :D

So Nationwide are doing 2.5% SVR and up to 95% for existing customers? :blink:

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If you owned the house outright you'd pay no rent. Wouldn't that make life even better?

it would. but I cant afford 400K. or the 80K the landlord has lost on his balance sheet ( would have been mine if Id bought last year for £480K).

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He'll print it for houses

He'll print it for shops

He'll print it for chavs

He'll print it for jobs

He'll print it for you

He'll print it for me

Trust good old Gordon

Just wait and see

this is my printing

this is my gun

this is for f**cking

this is for fun

courtesy full metal jacket.

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it would. but I cant afford 400K. or the 80K the landlord has lost on his balance sheet ( would have been mine if Id bought last year for £480K).

Your time will come.

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Your time will come.

warning: I bought a little gold....expect prices to plummet.

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Good stuff. I knew you'd get there in the end.

hey...this is adding to my collection dontchaknow. I heard, maybe from you, that in Germany, with all the hyperinflation, 2 ozs would buy a block of flats.

Im looking forward to it.

Id rather pay money for it though TBH.

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hey...this is adding to my collection dontchaknow. I heard, maybe from you, that in Germany, with all the hyperinflation, 2 ozs would buy a block of flats.

Im looking forward to it.

Id rather pay money for it though TBH.

Patience is a virtue and grows with experience.

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I want to sell 7 Kilo's of silver

expect the same

thats a lot of One Rail cutlery pardner!

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So Nationwide are doing 2.5% SVR and up to 95% for existing customers? :blink:

just to stop the loans going bad and having to reserve more capital against them.

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