symo Posted June 18, 2009 Share Posted June 18, 2009 This doens't even come close to NINJA, this is far far worse. Yes HBOS have clearly been Kung-Fu fighting, though the FSA and BoE have hardly been fast as lightning. Quote Link to comment Share on other sites More sharing options...
worzel Posted June 18, 2009 Share Posted June 18, 2009 that sort of logic will get you a job with the FSAif someone buys a 100k house with 70k borrowing and their income is 10k, it is very unlikely that they can service the loan or repay it - irrespective of the fact that there are more buyers for the 100k house as opposed to the 10m one Thanks for the vote of confidence. The bank main concern is security of the loan. If they are happy that the house is worth £100k, the person has stated that they earn a suffient amount to service that level of debt, and the credit history shows that they have a good repayment history, then chances are that they will be able to service the mortgage. Given that anyone can lose their job at any time anyway, verifying income does not mitigate all risk. In the limited number of cases where the borrower lied, the house would be able to be sold and the lender recover the outstanding amount, or at least most of it. The bigger issue is where you have people being encouraged and assited to lie by morgage brokers etc, and where income is not verified on high loan to value mortgages (which arguably are a bigger problem in themselves), which I am sure happened a lot. All I was doing was citing a fairly common situation where it would not be as important to verify the level of income. Quote Link to comment Share on other sites More sharing options...
crashologist Posted June 18, 2009 Share Posted June 18, 2009 Have you tried selling Vibe door to door? no will this help me "when I'm back on my feet again"? Quote Link to comment Share on other sites More sharing options...
Sledgehead Posted June 18, 2009 Share Posted June 18, 2009 (edited) Morons, the lot of them. How on earth was this ever viewed as being acceptable.... and more importantly why is it that the rest of us are being expected to bail these people (the banks and the mortgage holders). You might wish to spare a thought for Lloyds investors, th epatsies par excellence of this credit crunch. One second they were riding high as the bank best placed to capitalise on the aftermath, next second Pesto had blogged out the fait accompli, signed sealed and delivered by messers Brown, Blank, Daniels and a host of so called 'fund managers'. Now, after having their shares collapsed in value, their dividends stolen, their chances of independence from thestae compromised and all hope of vulture status obliterated, they are now told by King that even the so called market dominant position is not acceptable ("any bank too big to fail is too big"). I wait with baited breath for the first lawsuit. My god, how much longer? Edited June 18, 2009 by Sledgehead Quote Link to comment Share on other sites More sharing options...
thecrashingisles Posted June 18, 2009 Share Posted June 18, 2009 Former HBOS mortgage chief Michael Bolton has claimed that up to 80 per cent of mortgages lent by the group before the credit crunch were accep- ted without proof of income. Isn't he the one who sang, "I said I was on 50k but I lied?" http://www.youtube.com/watch?v=ch7txUjCmiA Quote Link to comment Share on other sites More sharing options...
crashologist Posted June 18, 2009 Share Posted June 18, 2009 Isn't he the one who sang, "I said I was on 50k but I lied?"http://www.youtube.com/watch?v=ch7txUjCmiA I told him I couldn't prove my income, the loan had just begun he said "I wanna be, I wanna be your loan provider!" Quote Link to comment Share on other sites More sharing options...
Jadoube Posted June 18, 2009 Share Posted June 18, 2009 lets say i have 3 millioni buy a house for 10 million should anyone check whether my income is such that i can afford the repayments on the 7 million loan Rather than a hypothetical question I'll give you a real one with 100% hard data rather than media quotes or speculation. The question is : Am I sub-prime? The facts are : On the one hand: I have a LTV of less than 1, a good credit score, and circa 80% equity, over 90% if you count the savings in the offset account. (Admittedly the equity is dropping as the HPC proceeds apace ). The mortgage is less than 70% of my income. I've worked for my employer for over 25 years and we are, mid-recession, making over 10% profits - so my job can reasonably be considered to be more safe than many. One the other hand: I threw a hissy fit at the length of time spent organising my mortgage. I refused to give the lender any more info and asked them whether they wanted to lend me the money or not. They did, so my income was not checked. I suggest that it is reasonable to subtract people like me from the total rather than simply making forecasts based on the "unchecked = sub-prime" assumption. Whats the alternative? If I am sub-prime you are pretty much saying 100% of mortgages are sub-prime - mithering about where income was not checked becomes an irrelevance. Quote Link to comment Share on other sites More sharing options...
OldGreg Posted June 18, 2009 Share Posted June 18, 2009 (edited) Thanks for the vote of confidence. The bank main concern is security of the loan. If they are happy that the house is worth £100k, the person has stated that they earn a suffient amount to service that level of debt, and the credit history shows that they have a good repayment history, then chances are that they will be able to service the mortgage. Given that anyone can lose their job at any time anyway, verifying income does not mitigate all risk.In the limited number of cases where the borrower lied, the house would be able to be sold and the lender recover the outstanding amount, or at least most of it. The bigger issue is where you have people being encouraged and assited to lie by morgage brokers etc, and where income is not verified on high loan to value mortgages (which arguably are a bigger problem in themselves), which I am sure happened a lot. All I was doing was citing a fairly common situation where it would not be as important to verify the level of income. The problem was that the banks didn't check incomes and so they were unable to tell the difference between good borrowers like yourself and the high risk liar loans. If they had bothered to check applications correctly then liar loans could not of existed, and no one would of ever of heard of Mr Pebble. Edited June 18, 2009 by OldGreg Quote Link to comment Share on other sites More sharing options...
Rare Bear Posted June 18, 2009 Share Posted June 18, 2009 Thanks for the vote of confidence. The bank main concern is security of the loan. If they are happy that the house is worth £100k, the person has stated that they earn a suffient amount to service that level of debt, and the credit history shows that they have a good repayment history, then chances are that they will be able to service the mortgage. Given that anyone can lose their job at any time anyway, verifying income does not mitigate all risk.In the limited number of cases where the borrower lied, the house would be able to be sold and the lender recover the outstanding amount, or at least most of it. The bigger issue is where you have people being encouraged and assited to lie by morgage brokers etc, and where income is not verified on high loan to value mortgages (which arguably are a bigger problem in themselves), which I am sure happened a lot. All I was doing was citing a fairly common situation where it would not be as important to verify the level of income. That in fact is a very reasonable attitude, so long as prices go up. Quote Link to comment Share on other sites More sharing options...
smiffy1967 Posted June 18, 2009 Share Posted June 18, 2009 Liar Loan heavenhttp://www.moneymarketing.co.uk/cgi-bin/it...h=341&f=342 Former HBOS mortgage chief Michael Bolton has claimed that up to 80 per cent of mortgages lent by the group before the credit crunch were accep- ted without proof of income. 10000% True I work with a young Indian Guy who purchased a property 6 weeks ago - mortgage approved by HBOS I asked him how he managed to get a mortgage when he is a contractor and has only been in his role for 3 months His reply: They didnt ask to see his paychecks Quote Link to comment Share on other sites More sharing options...
Jim B. Posted June 18, 2009 Share Posted June 18, 2009 Have you tried selling Vibe door to door? Oh, and remember: next Friday... is Hawaiian shirt day! Quote Link to comment Share on other sites More sharing options...
happy_renting Posted June 18, 2009 Share Posted June 18, 2009 You might wish to spare a thought for Lloyds investors, th epatsies par excellence of this credit crunch. One second they were riding high as the bank best placed to capitalise on the aftermath, next second Pesto had blogged out the fait accompli, signed sealed and delivered by messers Brown, Blank, Daniels and a host of so called 'fund managers'. Now, after having their shares collapsed in value, their dividends stolen, their chances of independence from thestae compromised and all hope of vulture status obliterated, they are now told by King that even the so called market dominant position is not acceptable ("any bank too big to fail is too big"). I wait with baited breath for the first lawsuit. My god, how much longer? Lloyds shareholders? Sorry for them? like f*** I am. They took the risk, they chose the Lloyds management. Their responsibility, their loss. No-one forced them to buy the shares. Quote Link to comment Share on other sites More sharing options...
Patrat Posted June 18, 2009 Share Posted June 18, 2009 in 1996, when I applied for my first mortgage from the Halifax, I had to take two years of payslips with me. As I was a Registrar and therefore considered to be a doctor in training I had to provide the details of the training scheme organiser so that she could be written to as the Halifax wish to enquire about my prospects. I had a 25% deposit for my house purchase. Lending is about the three Cs: capacity to repay, collateral (deposit) and character. Any bank or building society that forget these simple principles will eventually be in serious trouble, as we taxpayers are now finding out. Quote Link to comment Share on other sites More sharing options...
General Melchett Posted June 18, 2009 Share Posted June 18, 2009 Oh, and remember: next Friday... is Hawaiian shirt day! Somebody gets it... 'Going to burn the building down......' Quote Link to comment Share on other sites More sharing options...
lowrentyieldmakessense(honest!) Posted June 18, 2009 Share Posted June 18, 2009 Rather than a hypothetical question I'll give you a real one with 100% hard data rather than media quotes or speculation. The question is : Am I sub-prime? The facts are : On the one hand: I have a LTV of less than 1, a good credit score, and circa 80% equity, over 90% if you count the savings in the offset account. (Admittedly the equity is dropping as the HPC proceeds apace ). The mortgage is less than 70% of my income. I've worked for my employer for over 25 years and we are, mid-recession, making over 10% profits - so my job can reasonably be considered to be more safe than many. One the other hand: I threw a hissy fit at the length of time spent organising my mortgage. I refused to give the lender any more info and asked them whether they wanted to lend me the money or not. They did, so my income was not checked. I suggest that it is reasonable to subtract people like me from the total rather than simply making forecasts based on the "unchecked = sub-prime" assumption. Whats the alternative? If I am sub-prime you are pretty much saying 100% of mortgages are sub-prime - mithering about where income was not checked becomes an irrelevance. no i dont think you are sub prime should they check your income to see that you can service the loan - yes i would if i was lending you the money regardless of whether i thought i had good security on the asset. I want to be happy that i am unlikely to need to resort to reposession. Quote Link to comment Share on other sites More sharing options...
General Melchett Posted June 18, 2009 Share Posted June 18, 2009 I'll be honest with you, I love his music. I do. I'm a Michael Bolton fan. For my money, I don't know if it gets any better than when he sings "When a Man Loves a Woman". I'd just like to make it clear that this is a quote from a movie, not what I personally think about Michael Bolton...... http://en.wikiquote.org/wiki/Office_Space Quote Link to comment Share on other sites More sharing options...
grumpy-old-man-returns Posted June 18, 2009 Share Posted June 18, 2009 Yes HBOS have clearly been Kung-Fu fighting, though the FSA and BoE have hardly been fast as lightning. well I liked it..... mind you it's one of those songs that you instantly get in your head, then can't get rid of it for bl00dy hours..... Quote Link to comment Share on other sites More sharing options...
Chest Rockwell Posted June 18, 2009 Share Posted June 18, 2009 Well well, this is no surprise to me at all! My bitch ex bragged to me how she got her mortgage - before I met her - from Halifax even though she was a temp at the time earning 12k a year...70k mortgage? They didn't ask to see any proof of income! Now she's sitting in huge negative equity in a street where similar properties are being repossessed one by one! And I was supposed to be jealous? Quote Link to comment Share on other sites More sharing options...
self Posted June 18, 2009 Share Posted June 18, 2009 Holy shit!! 80%! I wonder how many billions of £'s that would translate to. This whole thing becomes worse and worse as time goes on. It's like an ocean of fraud and criminal activity that gets bigger and bigger. Once you step back and look at it as a whole you go Hooooooooooooly Sheeeeeeeeeeeeet!! The biggest fraud of all time. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted June 18, 2009 Share Posted June 18, 2009 Holy shit!! 80%! I wonder how many billions of £'s that would translate to. This whole thing becomes worse and worse as time goes on. It's like an ocean of fraud and criminal activity that gets bigger and bigger. Once you step back and look at it as a whole you go Hooooooooooooly Sheeeeeeeeeeeeet!! The biggest fraud of all time. It's one huge Ponzi Scheme, which has affected anyone. Even the honest people have been suckered because you've overpaid for you home because of scum like this lying. If they didn't lie house prices wouldn't have got out of hand as no one would have been able to afford it. However too many people got caught up in the property frenzy and mania took hold which completely distorted the market and now looks like dragging us all down. Quote Link to comment Share on other sites More sharing options...
SarahBell Posted June 18, 2009 Share Posted June 18, 2009 Lending is about the three Cs: capacity to repay, collateral (deposit) and character. Any bank or building society that forget these simple principles will eventually be in serious trouble, as we taxpayers are now finding out. Indeed. It seems mad that they slipped away from this so easily... Quote Link to comment Share on other sites More sharing options...
Bubble&Squeak Posted June 18, 2009 Share Posted June 18, 2009 For simplicities sake, I take it as one huge sphincter. Speaking of which where's Hamish? Hamish Mc... still think mortgage fraud had little to do with inflating the bubble so far? Quote Link to comment Share on other sites More sharing options...
self Posted June 18, 2009 Share Posted June 18, 2009 Indeed.It seems mad that they slipped away from this so easily... But you are forgetting one thing. They only did this because they ASSUMED that house prices would only go up. Think about it, the banks win either way. For example, take one of these HBOS liar loans, HBOS makes the mortgage, then sells it to some other sucker. However, they were also buying these crappy loans from other people as well as keeping some of theirs on their books. Therefore, if house prices go up and for whatever reason someone's house is repossessed, the bank then sells that house AT A PROFIT, even if the house price remains flat, the bank still makes a profit as they have the proceeds of the sale AND AT LEAST A one months mortgage payments. Now, when house prices go down, the shit hits the fan. However, the banks STILL don't lose as we have to bail them out. They never lose. It's a huge scam. Quote Link to comment Share on other sites More sharing options...
thecrashingisles Posted June 18, 2009 Share Posted June 18, 2009 But you are forgetting one thing. They only did this because they ASSUMED that house prices would only go up. That's what happens when you put a retail executive in charge of a bank and downgrade the regulator... Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted June 18, 2009 Share Posted June 18, 2009 But you are forgetting one thing. They only did this because they ASSUMED that house prices would only go up. How to get a £1.38bn house in 100 years This was the riches awaiting the bankers if only house prices only ever go up. Quote Link to comment Share on other sites More sharing options...
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