Jump to content
House Price Crash Forum
Sign in to follow this  
Pent Up

I Would Have Been Denied Mortgage, Says Minister (Shapps)

Recommended Posts

By James Moore, Deputy Business Editor

Saturday, 27 November 2010

The Housing Minister, Grant Shapps, says he himself would have failed to get a mortgage had new proposals for the mortgage market drawn up by the City watchdog been in effect when he bought his home.

Speaking at the National House-Building Council's annual lunch, Mr Shapps said: "I think it was about the moment I realised that I wouldn't have a mortgage if the Mortgage Market Review (MMR) changes went through that I kind of thought that this might be going a step too far."

He continued: "There is no point in closing the door after the horse has bolted. The whole problem with the mortgage market wasn't a pernickety thing about whether you could lend X or Y to a person, or what form you had to get a borrower to sign. It was because there was a lack of effective central regulation on how the banks were operating." He added that "What's required here is proper, sensible top-level regulation – not pernickety down-in-the-dirt what can you do what can't you do as a mortgage company."

He told his audience that he hoped that the Financial Services Authority (FSA) "will be getting that message from you and everyone else. They are of course independent, but I think it's very important that we learn the lessons of the past without repeating them – which is what they are in danger of doing."

The FSA has said that the reforms proposed in the review, which would demand that banks undertake strict "affordability" tests before advancing loans, were prompted by widespread examples of cavalier lending in the run-up to the credit crunch. Critics have said the FSA's prescription for dealing with the problem is an over-reaction. Mr Shapps's remarks represent the first time that a minister has commented publicly on the increasingly controversial review, which the Council of Mortgage Lenders (CML) has said would have banned half of all the mortgages advanced in the last five years – amounting to some 4m home loans, 95 per cent of which are being repaid as due.

You what Shappsy? So the FSA are in danger of repeating the mistakes of the past by sensible regulation of the Market in the future?

Did I not understand that comment or has he completely contradicted himself?

Share this post


Link to post
Share on other sites

Someone who needs to keep two homes running on one income denied a mortgage? What sense does that make?

Apart from the fact he'd have had all his living expenses and more paid for too.

Share this post


Link to post
Share on other sites

You what Shappsy? So the FSA are in danger of repeating the mistakes of the past by sensible regulation of the Market in the future?

Did I not understand that comment or has he completely contradicted himself?

:o

That is very worrying. It is the first time I hear read a coalition government minister speaking in favour of more credit to the property market. They had been consistent up to now. :(

Share this post


Link to post
Share on other sites

Yes, worrying - the Tories have made encouraging noises about end the endless, desperate attempts to prop up the housing market at all costs.

With VAT set to go up, ongoing pay freezes, no tax cuts to stimulate jobs creation as the public sector is cut and the reality that so many private sector companies have been largely feeding off the state anyway (Rok) it's going to get bad for quite some time.

What will really help the nation pick itself up is - REALLY ******ING CHEAP HOUSING COSTS. If you've got a cheap house to live in, you can ride out the storm, it doesn't matter if you've had pay frozen or had to take a crap job to tide you over, you may have the space to set up your own business as you're not shackled to he wrong job as you need to service a huge mortgage debt. Even better, a lower cost of living would encourage investment - surely a workforce that might seem well paid yet only able to live like a student is not a happy one.

Share this post


Link to post
Share on other sites

Just how important are Shapps' comments in influencing the long term direction for house prices?

This statement seems seriously damaging to me, and seriously encouraging to the bulls who left comments.

Share this post


Link to post
Share on other sites

....Speaking at the National House-Building Council's annual lunch....

When people who build won't build, when they must build to avoid a forthcoming housing crisis - what sort of noises should you make?

Share this post


Link to post
Share on other sites

Sorry boys but they're the same as everybody else.

I fear we may be waiting another 10 years. Some people have been predicting this for almost that long.

This could be as good as it gets? :(

Share this post


Link to post
Share on other sites

"What's required here is proper, sensible top-level regulation – not pernickety down-in-the-dirt what can you do what can't you do as a mortgage company."

Hmmm ... what a non-statement. Sensible top-level regulation that carries teeth surely requires enforced rules about what you can and can't do as a mortgage company - otherwise "loopholes" are found and exploited.

Share this post


Link to post
Share on other sites

Looks like the VI's are winning - as I predicted.

THE REASON MR SHAPPS WOULDN'T GET A MORTGAGE IS - BECAUSE HOUSE PRICES ARE ABSURDLY HIGH. THEY ARE ABSURDLY HIGH BECAUSE THEY GOT TO THAT STATE THANKS TO IRRESPONSIBLE & UNSUSTAINABLE LENDING. LENDING WHICH IS EFFECTIVELY 5, 6, 7, 8, 9, 10+ ANNUAL SALARY - & INTEREST ONLY - AND "SELF-CERT" WHERE PEOPLE EARNING £25k per anum LIED AND SAID THEY EARNED £85k.

THESE WERE THE TOXIC LIAR LOANS WHICH FUELLED THE INSANE PRICES WE HAVE TODAY. LIAR LOANS and STUPID MULTIPLE MORTGAGES WERE LIKE ROCKET FUEL THROWN ONTO THE BONFIRE - THEY EXPLODED THE "PRICES" IN EVERY STREET, VILLAGE, TOWN & CITY.

THE REASON MR SHAPPS & EVERYONE ELSE WOULDN'T GET A MORTGAGE IS BECAUSE HOUSE PRICES HAVE BEEN ARTIFICIALLY & FRAUDULENTLY BOOSTED.

TOXIC LIAR LOANS & THEIR EFFECTS ARE LIKE THE GENIE OUT OF THE BOTTLE: IT IS VERY DIFFICULT TO GO BACK TO NORMAL AND GET THE GENIE BACK INTO THE BOTTLE. BUT IT IS THE ONLY PRACTICABLE WAY FORWARD.

Share this post


Link to post
Share on other sites

:o

That is very worrying. It is the first time I hear read a coalition government minister speaking in favour of more credit to the property market. They had been consistent up to now. :(

Yup. Very worrying indeed.

Looks like the VI's are winning - as I predicted.

THE REASON MR SHAPPS WOULDN'T GET A MORTGAGE IS - BECAUSE HOUSE PRICES ARE ABSURDLY HIGH. THEY ARE ABSURDLY HIGH BECAUSE THEY GOT TO THAT STATE THANKS TO IRRESPONSIBLE & UNSUSTAINABLE LENDING. LENDING WHICH IS EFFECTIVELY 5, 6, 7, 8, 9, 10+ ANNUAL SALARY - & INTEREST ONLY - AND "SELF-CERT" WHERE PEOPLE EARNING £25k per anum LIED AND SAID THEY EARNED £85k.

THESE WERE THE TOXIC LIAR LOANS WHICH FUELLED THE INSANE PRICES WE HAVE TODAY. LIAR LOANS and STUPID MULTIPLE MORTGAGES WERE LIKE ROCKET FUEL THROWN ONTO THE BONFIRE - THEY EXPLODED THE "PRICES" IN EVERY STREET, VILLAGE, TOWN & CITY.

THE REASON MR SHAPPS & EVERYONE ELSE WOULDN'T GET A MORTGAGE IS BECAUSE HOUSE PRICES HAVE BEEN ARTIFICIALLY & FRAUDULENTLY BOOSTED.

TOXIC LIAR LOANS & THEIR EFFECTS ARE LIKE THE GENIE OUT OF THE BOTTLE: IT IS VERY DIFFICULT TO GO BACK TO NORMAL AND GET THE GENIE BACK INTO THE BOTTLE. BUT IT IS THE ONLY PRACTICABLE WAY FORWARD.

Share this post


Link to post
Share on other sites

It's not worrying - it's what you should expect!

"If human vices such as greed or envy are systematically cultivated, the inevitable result is nothing less than a collapse of intelligence.

A man driven by greed or envy loses the power of seeing things as they really are, of seeing things in their roundness and wholeness, and his very successes become failures.

If whole societies become infected by these vices, they may indeed achieve astonishing things but they become increasingly incapable of solving the most elementary problems of everyday existence" :rolleyes:

Edited by erranta

Share this post


Link to post
Share on other sites

It's not worrying - it's what you should expect!

"If human vices such as greed or envy are systematically cultivated, the inevitable result is nothing less than a collapse of intelligence.

A man driven by greed or envy loses the power of seeing things as they really are, of seeing things in their roundness and wholeness, and his very successes become failures.

If whole societies become infected by these vices, they may indeed achieve astonishing things but they become increasingly incapable of solving the most elementary problems of everyday existence" :rolleyes:

Awesome! Where's that from?

Honestly - I don't think market forces are going to win in the end. I reckon prices may fall 5-10% max and just stay there for years. Have we learned nothing? We wont win! We just have to back the 'right' horse in future, even if immoral, as soon as possible, in order to not be shafted completely. The right horse is any that exploits something for insane and/or easy profit.

Becoming ever more cynical by the day here. Not sure if we will see a crash.

Share this post


Link to post
Share on other sites

When people who build won't build, when they must build to avoid a forthcoming housing crisis - what sort of noises should you make?

Exactly, just what else would he be expected to say - 'houses, you know those things you all sell, should be much cheaper'?

Notice also how he refers to the independent fsa ie 'its those bad ole fsa boys doing this not me'.

If this government really wanted hpi they could easily encourage it (eg tax incentives for buyers). Instead, they'll try and distance themselves from anything hpi negative (case in point).

The clue is in his job title really - politician..

Share this post


Link to post
Share on other sites

The mask slips.

For many on this site, this should be a wake up call. TPTB will burn what remains of the productive economy to maintain stable near-peak house prices.

I suggest you prepare accordingly.

Share this post


Link to post
Share on other sites

The mask slips.

For many on this site, this should be a wake up call. TPTB will burn what remains of the productive economy to maintain stable near-peak house prices.

I suggest you prepare accordingly.

and yet, there is a mortgage "famine" and sales numbers are falling..

I guess, the banks need money to lend, in order to lend. No MBS, no CDOs, no money to lend....they are all lent out. the Famine will remain...if we are at peak debt, then only money paid off can be relent.

Share this post


Link to post
Share on other sites

Awesome! Where's that from?

'Small is Beautiful', 1973 E.F. Schumacher :D

Those few sentences perfectly sum up the 'peaking' of societies & when they are on the verge of losing it!

(such as Rome's at-the-top-of-their-game mass orgies/consumption/elite power struggles from greed and envy - leading to final implosion thru not being able to solve everyday citizens/state existence)

Share this post


Link to post
Share on other sites

Grant Shapps was born in 1968, which means he was 27/28 in the mid-90s. He got married in 1997. He's the perfect age to have got on the ladder when it was cheap, watched his "investment" increase by 10% plus for a few years, and then leverage up to a family home in the early 2000s and seen the same thing happen to that.

Given his personal experience, how do you think Grant Shapps feels about low interest rates, easy credit and HPI?

The priced out generation will be approaching positions of power towards the second half of this decade, but until then politicians haven't been nobbled by the VIs - they are the VIs.

Share this post


Link to post
Share on other sites

'Small is Beautiful', 1973 E.F. Schumacher :D

Those few sentences perfectly sum up the 'peaking' of societies & when they are on the verge of losing it!

(such as Rome's at-the-top-of-their-game mass orgies/consumption/elite power struggles from greed and envy - leading to final implosion thru not being able to solve everyday citizens/state existence)

"Everything that can be invented has been invented."

Charles H. Duell, Commissioner, U.S. Office of Patents, 1899.

Share this post


Link to post
Share on other sites

and yet, there is a mortgage "famine" and sales numbers are falling..

I guess, the banks need money to lend, in order to lend. No MBS, no CDOs, no money to lend....they are all lent out. the Famine will remain...if we are at peak debt, then only money paid off can be relent.

If you feel a bit 'peaky' here's reality!

The BJ's are 'spent' and flooded - they are no more!

The have been stripped bare by the uber wealthy grand master classes for their selfish use only.

They are not to be looked up to - only in total 'compartmentalised' ignorance! B)

Share this post


Link to post
Share on other sites

Cant the idiot see the bigger picture.

Its not some personal crusade against him as an individual, everyone would be denied a mortgage at these prices without a massive deposit. Thus less money would go into the market chasing a set amount of homes, thus house prices would fall, thus he would need a smaller mortgage, thus he would be in the same place he is now but with a lot less debt and a lot more credit freed up for industry.

He continued: "There is no point in closing the door after the horse has bolted.

So hes basically saying, people who bought 2003 on have suffered so every future buyer should suffer as well?

The horse bolting analogy is stupid. Theres a constant stream of horses bolting, at some point it would be intelligent to close the gate. Its not like he was the last person to buy a house.

Share this post


Link to post
Share on other sites

Grant Shapps was born in 1968, which means he was 27/28 in the mid-90s. He got married in 1997. He's the perfect age to have got on the ladder when it was cheap, watched his "investment" increase by 10% plus for a few years, and then leverage up to a family home in the early 2000s and seen the same thing happen to that.

Given his personal experience, how do you think Grant Shapps feels about low interest rates, easy credit and HPI?

The priced out generation will be approaching positions of power towards the second half of this decade, but until then politicians haven't been nobbled by the VIs - they are the VIs.

But those in positions of power wont care anyway. Couple of people i know have now splashed out £500k on homes, (age late 20s) funded partly or mostly by BoMaD.

Share this post


Link to post
Share on other sites

Grant Shapps was born in 1968, which means he was 27/28 in the mid-90s. He got married in 1997. He's the perfect age to have got on the ladder when it was cheap, watched his "investment" increase by 10% plus for a few years, and then leverage up to a family home in the early 2000s and seen the same thing happen to that.

Given his personal experience, how do you think Grant Shapps feels about low interest rates, easy credit and HPI?

The priced out generation will be approaching positions of power towards the second half of this decade, but until then politicians haven't been nobbled by the VIs - they are the VIs.

indeed

strictly speaking this is still playing into the hands of the long drawn out crash situation, and again strictly speaking HPI supportive measures just prolong the window of opportunity for good value renting

Share this post


Link to post
Share on other sites

The man's an idiot or he's lying. Of course he would get a mortgage. He just wouldn't be given a loan for an absurd amount of money that he has no hope of repaying. What he's saying is (quote...."no point in shutting the stable door now") that we NEED more and more lending of money to people who can't repay it in order to keep house prices from falling. Getting back to sensible sustainable lending is not an option because it's too late.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 144 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.