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People Are Still Re-Mortgaging And Taking Out Equity


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Work with this lass, she is single , two kids below 8 years, no husband, doesnt earn much.

I know she has been getting a new mortgage deal (I thought to reduce costs). Today she is all smiles and happy, the deal is going through. I say I dont know why you are so happy, its not like you are moving. Turns out she is getting extra money to put in a new kitchen and other treats.

Everyday people still dont get it, and these are the sort of people you will be competing against when it comes time to buy your own home.

Its never been the banks fault, although admittedly they helped, it was actually the stupid stupid people we all live amongst who thought it was fine to take out 6 times their earnings.

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Without knowing all the figures, it may not be all that daft. Perhaps her mortgage was only 2 x wages before, having been left a house with a low mortgage in a divorce settlement? Is she re-mortgaging after a promotion?

It's constant MEWing that can cause trouble. Some people go so far into debt that they are using the money they took out to meet the interest payments. It delays the inevitable if they get laid off.

Is her kitchen knackered? Probably not, you know, women.... :ph34r:

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Its never been the banks fault, although admittedly they helped, it was actually the stupid stupid people we all live amongst who thought it was fine to take out 6 times their earnings.

The entire point of banks is to stop stupid people from borrowing money they can't repay. If stupid people are borrowing money they can't repay it is the fault of the banks.

If the banks are free to shift the risk of default off their books, and therefore don't care about whether the debt is repaid or not, then we get a global financial meltdown.

This was the fault of the banks - all this right wing noise that pins the blame on the stupid borrowers is a pathetic rewriting of history.

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Work with this lass, she is single , two kids below 8 years, no husband, doesnt earn much.

I know she has been getting a new mortgage deal (I thought to reduce costs). Today she is all smiles and happy, the deal is going through. I say I dont know why you are so happy, its not like you are moving. Turns out she is getting extra money to put in a new kitchen and other treats.

Everyday people still dont get it, and these are the sort of people you will be competing against when it comes time to buy your own home.

Its never been the banks fault, although admittedly they helped, it was actually the stupid stupid people we all live amongst who thought it was fine to take out 6 times their earnings.

Friend A: House value approx £350K - bought approx 1990 - outstanding mortgage £25K

Friend A's neighbour: House value approx £350K - bought approx 1990 - outstanding mortgage £250K

Go figure.......................

Edited by oldbaginaonebed
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Friend A: House value approx £350K - bought approx 1990 - outstanding mortgage £25K

Friend A's neighbour: House value approx £350K - bought approx 1990 - outstanding mortgage £250K

Go figure.......................

Bet they are both making similar monthly mortgage payments....has the neighbour only the one property?

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She does get those, as was happy to see that they werent being reduced for people in her "situation."

...all put down as income on the application which generates a healthy commission for the broker....who does the credit risk...?....or is that just put down as safe with worst case scenario being repossession....and keep the commissions rolling.... :rolleyes:

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You seem to know most of her details, put those and some anonymous stuff in to see how much she gets:

http://taxcredits.hmrc.gov.uk/Qualify/DIQHousehold.aspx

You could be appalled.

Im not appalled or surprised, but according to that website she would get:-

Child tax credit, £3346.44

Working tax credit, £1324.68

Total £4671.12

I based on her being paid £13k a year. I still think some condoms would have been cheaper.

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Im not appalled or surprised, but according to that website she would get:-

Child tax credit, £3346.44

Working tax credit, £1324.68

Total £4671.12

I based on her being paid £13k a year. I still think some condoms would have been cheaper.

Is that all? When I discovered that calculator recently I went through it as a 22yo, no spouse with 2 kids and ended with £10,950

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Im not appalled or surprised, but according to that website she would get:-

Child tax credit, £3346.44

Working tax credit, £1324.68

Total £4671.12

I based on her being paid £13k a year. I still think some condoms would have been cheaper.

Do you know how much they are lending her? Cos I struggle to see how she can make ends meet with two kids on 18k a year gross.

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Do you know how much they are lending her? Cos I struggle to see how she can make ends meet with two kids on 18k a year gross.

No I dont. Wont she get another chunk of child benefit on top of that? I do live up north, so depending on when she bought it could be quite a cheap property.

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Work with this lass, she is single , two kids below 8 years, no husband, doesnt earn much.

I know she has been getting a new mortgage deal (I thought to reduce costs). Today she is all smiles and happy, the deal is going through. I say I dont know why you are so happy, its not like you are moving. Turns out she is getting extra money to put in a new kitchen and other treats.

Everyday people still dont get it, and these are the sort of people you will be competing against when it comes time to buy your own home.

Its never been the banks fault, although admittedly they helped, it was actually the stupid stupid people we all live amongst who thought it was fine to take out 6 times their earnings.

Wrong. People's behaviour is very similar, anywhere, any time. If/when interest rates are low, people will borrow more, and when interest rates are high, they borrow less. It is the job of monetary policy to control that. This crises was caused by a credit/debt/assets prices bubble, caused by interest rates being kept too low for too long, thanks to Gordon Brown tampering with the inflation index in 2003, forcing thus the BoE to keep interest rates too low. It is not the people's job to know high finances or economics. It is unrealistic and hence unfair to expect that from any people. It was mainly Gordon brown's fault.

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It is unrealistic and hence unfair to expect that from any people. It was mainly Gordon brown's fault.

Although I despise Brown as much as the next person, if it was the banks faults and not individuals then why do we not have a massive mortgage? Why are we waiting to buy at a sensible income multiplier rather than just jumping in?

I expect everyone to have a rough idea of the worth of things, and the common sense to know that when something goes up 20% in a year while wages go up 3% that those increases are crazy.

If more people had said NO I wont borrow 4 times, 5 times, 6 times my salary then prices would never have reached the levels they did regardless of anything the banks did.

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If more people had said NO I wont borrow 4 times, 5 times, 6 times my salary then prices would never have reached the levels they did regardless of anything the banks did.

Where does that end though? I won't borrow 3, 2, 1 times my salary? Houses priced at 15k?

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  • 433 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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