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Mr. Miyagi

Banks Should Offer 'mates Mortgages' So Friends Can Buy Together .

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Banks should offer ‘mates mortgages’ to help groups of friends buy a home together, a Government minister will say today.

Grant Shapps will urge lending giants to send a lifeline to the record numbers of first-time buyers struggling to get on the property ladder.

The housing minister said that without urgent help from banks a generation of young people would be locked out of the market.

The answer, he suggested, was a radical and new type of lending that he called ‘mates mortgages’.

In most parts of the country it is almost impossible for a young person with a full-time job to buy a home on their own.

The average salary of workers in their 20s is £21,000 whereas the cost of the average home is around £160,000.

As a result, only those on much higher salaries or with family money can put down a deposit on a house.

Mr Shapps said: ‘If there are mates who are perfectly capable of paying monthly mortgage payments but are struggling to fund a deposit of their own, there should be straightforward options to unite with their friends and take the first step on to the housing ladder together.’

His plea for ‘mates mortgages’ will be made today when he holds his second summit to tackle the problems facing first-time house buyers.

But yesterday mortgage experts raised doubts as to whether the Tory minister’s scheme would be practical.

David Hollingworth, of the independent adviser London & Country, said the proposal was ‘absolutely full of risks’.

'Full of risks': Critics of the scheme suggest that friends have enough problems sharing flats and it will only get worse if they have a mortgage to worry about

'Full of risks': Critics of the scheme suggest friends have enough problems sharing flats and it will only get worse if they have a mortgage to worry about

He added: ‘People get into enough strife when they rent a flat together over basic things like: “Who finished off the milk?” and “Who is going to do the washing up?” It will be even worse if they have a mortgage to fight over.’

Mel Bien, of the mortgage broker Private Finance, said: ‘It is one thing to rent with friends, which is traumatic enough, let alone to get a mortgage with them.’

The vast majority of mortgage deals are restricted to couples or two sisters or two brothers.

Britannia is one of a small number of lenders to offer a mortgage that allows friends to buy together.

Its Share to Buy scheme, launched in July 2004, takes into account the incomes of up to four people. But just 1,300 customers have signed up so far.

The number of young people able to buy their first home has collapsed, according to the Council of Mortgage Lenders.

A decade ago, nearly 600,000 bought every year but in 2010 the total had slumped to just under 200,000.

Meanwhile, the average deposit put down by a first-time buyer has doubled from 10 per cent before the credit crunch to 20 per cent today.

Research suggested last week that by 2025, young people will not be able to buy their first home until they have turned 40.

The report, from the financial services firm LV, blamed everything from high property prices to demands for big deposits.

To make matters worse, average rents have reached an all-time high of nearly £700 a month, or close to £1,000 a month in London.

Research by the Department for Communities and Local Government found that 86 per cent of young people aspire to buy their own home.

http://www.dailymail.co.uk/news/article-2011237/Grant-Shapps-Banks-offer-mates-mortgages.html

Repeat after me, we must keep this ponzi scheme going at all costs.

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In the red corner - the shylock party, in the blue corner the shylock party.

David Hollingworth, of the independent adviser London & Country, said the proposal was ‘absolutely full of risks’.

'Full of risks': Critics of the scheme suggest that friends have enough problems sharing flats and it will only get worse if they have a mortgage to worry about

When brokers themselves are pointing out the obvious downfalls of this sort of arrangement you know how bad a scheme is.

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In the red corner - the shylock party, in the blue corner the shylock party.

David Hollingworth, of the independent adviser London & Country, said the proposal was ‘absolutely full of risks’.

'Full of risks': Critics of the scheme suggest that friends have enough problems sharing flats and it will only get worse if they have a mortgage to worry about

When brokers themselves are pointing out the obvious downfalls of this sort of arrangement you know how bad a scheme is.

In the red corner, a bunch of VI multi property owning shylocks

In the Blue corner, a bunch of VI multi property owning shylocks

In the yellow corner, a bunch of VI multi property owning shylocks

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It's looking like I'm going to have no choice but to leave. Something has gone badly wrong in this country.

Can someone who lived through GC1 reassure me that this is the type of crap TPTB were pushing just before the housing market fell off the precipice? Bear losing faith here.

Edited by 50sQuiff

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They really don't understand anything.

If I was an outside observer, the only conclusion is that our leaders want to us all to maximise debt rather than wealth/income.

Shapp's understands perfectly. He is the enemy of all First Time Buyers. He wants all of us to lead a life of debt slavery.

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It's looking like I'm going to have no choice but to leave. Something has gone badly wrong in this country.

Couldn't agree more. I'm looking for jobs in Switzerland at the moment.

It pains me to say but I feel the UK is irretrievably broken - and no one is willing to hit the re-set button. It won't be long before the systems collapses and it re-sets itself......

:(

.

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As I recall similar schemes were rife in the late 80's when multiple MIRAS tax relief was still possible.

House prices were boosted until the multiple relief was ended.

Then we had the early 90's HPC.

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http://www.dailymail.co.uk/news/article-2011237/Grant-Shapps-Banks-offer-mates-mortgages.html

Repeat after me, we must keep this ponzi scheme going at all costs.

my, these tories are innovative chaps indeed, its a shame they werent in charge in thre noughties to surely adopt measures to stop the banking mortgage debt expansion after setting the ball rolling in the 80s

Edited by georgia o'keeffe

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Depressing... :(

It's beyond me how anyone could possibly think this would help first time buyers.

its not about helping Ftbs, its about doing everything to keep expanding the debt to cover their sorry asses the same as Gordo Mc twaat "You work for them"

Edited by georgia o'keeffe

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What was that program on tv about buying with a friend (Or was it a stranger?) ?

One of the people was a girl in the army I thnk

Was awful TV - doomed to fail.

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In the red corner - the shylock party, in the blue corner the shylock party.

David Hollingworth, of the independent adviser London & Country, said the proposal was 'absolutely full of risks'.

'Full of risks': Critics of the scheme suggest that friends have enough problems sharing flats and it will only get worse if they have a mortgage to worry about

When brokers themselves are pointing out the obvious downfalls of this sort of arrangement you know how bad a scheme is.

but, but, this type of scheme was very popular in 2007!

buy with a friend, buy with a person you dont know, IO, lifetime mortgages, lie about income mortgages, part buy with builder/Government.

It just still screams....PRICES ARE TOO HIGH.

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From 2008

Shadow housing minister Grant Shapps admits taking donations from estate agent and four other firms connected with property industry

Tory shadow housing minister Grant Shapps has been using money from an estate agent and property firms to run his private parliamentary office, the MP has admitted.

http://www.propertyweek.com/news/anti-hips-tory-funded-by-property-firms/3113864.article

His one task in life is to try keep house prices inflated. He wants loose lending, council taxpayer's money being used as deposits for FTBs, shared equity, etc

In November 2010 he blocked the FSA from instigating any mortgage restrictions saying "There is no point in closing the door after the horse has bolted."

http://www.independent.co.uk/news/business/news/i-would-have-been-denied-mortgage-says-minister-2145051.html

Since then non verified mortgages are increasing again. Latest FSA figures on the percentage of non verified income mortgages

Including lifetime mortgages:

Q1 2010: 42.60%

Q2 2010: 37.38%

Q3 2010: 32.44%

Q4 2010: 30.10%

Q1 2011: 30.40%

Excluding lifetime mortgages:

Q1 2010: 41.24%

Q2 2010: 36.08%

Q3 2010: 31.05%

Q4 2010: 28.56%

Q1 2011: 28.79%

He was on the landlords from hell program last night and said "75% of people who rent are happy so we are only talking about a small minority here".

A small minority is 2 or 3 out of 100, not 1 in every 4.

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I honestly don't know whether to laugh or cry. This is our f#cking housing minister and this is the best solution he can find??!

Anyone who has spent any time house sharing in their late teens and early twenties will know how much fun it is and how great a time they had. They will also know how happy they were the day they no longer had to do it because while living with your mates for a couple of years is great it WILL eventually do your head in... not to mention the complications and expense of buying each other out when a friend meets a partner and wants to move out - or worse: wants her to move in. Absolute nightmare.

Of course, this won't happen. It's utter nonsense and another bit of government waffle to give the impression they're actually trying to do something before Shapps steps down.

But for any young people out there reading / hearing this "news" and thinking it's a good idea: it's not.

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Why all the bile? House prices need supporting. It all just looks like jealousy from people who selifishly want cheap houses at the expense of the basis of the country's economy. What's next, you'll be saying that Gordon Brown shouldn't be made king.

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Although the signs have been there for some time, I think this latest pronouncement finally marks the day in which we can safely label the housing minister a complete tool.

+1

He needs to go. As utterly clueless as the last lot. And encouraging the young and naive to overpay for clearly overvalued assets, which they will be unable ti upgrade from when prices fall, and a life of debt misery. C***s.

Edited by mikthe20

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Mates mortgages? How about 'First Time Sharers' ?

Sharing with mates is typically what young people do for a few years prior to getting a real life. Hardly the basis for a major 25 year procurement of the largest sum of debt in a persons life.

This to me is evident the housing minister is playing lip service to the problem and can't publicly admit the problem is actually prices.

He cant be that stupid.

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  • 284 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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