The Masked Tulip Posted September 24, 2011 Share Posted September 24, 2011 Banks pull plug on the buy-to-let loans boom after a flood of applications from landlords Read more: http://www.dailymail.co.uk/news/article-2041246/Banks-pull-plug-buy-let-loans-boom-flood-applications-landlords.html#ixzz1Yr911pjl Quote Link to comment Share on other sites More sharing options...
200p Posted September 24, 2011 Share Posted September 24, 2011 (edited) Mug Punters "We need money to finance this great idea, renting out property!" The Institutional Investors "I'm out". Edited September 24, 2011 by Money Spinner Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted September 24, 2011 Share Posted September 24, 2011 Pretty much everything that is wrong in the market summed up right here.... 'Property Owning Dmeocracy'.....God rest her soul. Nice and when the govt finally gets the balls up to sort out the mess that is housing benefit what then??? It would be cheaper for the govt to buy up the properties at this price and rent them out, or just give it to the renters. So in 9 years the taxpayer will have forked out £48,600 in rent that's obviously excluding if rents go up... In the current economic climate I don't think that will happen but it just shows how screwed everything is. Quote Link to comment Share on other sites More sharing options...
mercsl Posted September 24, 2011 Share Posted September 24, 2011 Over 5 years cheaper to kick your tenants out, move in briefly and get a residential mortgage fixed for five years then let it out. No one ever checks. Savings would be 25k over five years comparing some rates. Quote Link to comment Share on other sites More sharing options...
Redcellar Posted September 24, 2011 Share Posted September 24, 2011 Mug Punters "We need money to finance this great idea, renting out property!" The Institutional Investors "I'm out". LOL It's quite incredible that banks loaned money to BTL in the first place. It's like walking into a casino and saying "extend me a credit line of 1 million please. If I win I keep all the money, if I lose you get nothing". It's a win win as you wrap it all up in a Ltd company and wash your hands of the failure. Absolute nuts. The dragons wouldn't even say "I'm out". They would say "are you having a f*cking laugh?" Quote Link to comment Share on other sites More sharing options...
Blod Posted September 24, 2011 Share Posted September 24, 2011 Pretty much everything that is wrong in the market summed up right here.... 'Property Owning Democracy'.....God rest her soul. As has already been pointed out this really does highlight virtually all of the problems in the housing sector. Interest rates rise and he's sunk, housing benefit drops and again he's sunk. No wonder the banking sector are screwed. :angry: Quote Link to comment Share on other sites More sharing options...
thecrashingisles Posted September 24, 2011 Share Posted September 24, 2011 Some of us have been priced out of the property market forever. We are now looked down on as lesser mortals because we don't own. My own sister asked me recently why I was bothering to decorate and keep the garden tidy - 'After all,' she commented, 'it's not your house and never will be so why bother?' She owns her own mortgage free home ( paid for entirely by her husband as she has never worked) and feels that renters are scrounging off those who have been clever enough to buy!!! Her attitude annoys me but I wonder how many others see renters as an underclass?- localgirl, Banbury, England, 24/9/2011 5:06 Quote Link to comment Share on other sites More sharing options...
Redcellar Posted September 24, 2011 Share Posted September 24, 2011 Looking at teh numbers. IO morgtage for BTL is stated as 3.59% (best deal they say!). So that's £448.75 / month Interest only And that's only on a £150,000 house. How do these numbers make any sense. Surely you can't make money once you start to save some aside for the capital repayments. Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted September 24, 2011 Share Posted September 24, 2011 Over 5 years cheaper to kick your tenants out, move in briefly and get a residential mortgage fixed for five years then let it out. No one ever checks. Savings would be 25k over five years comparing some rates. Quote Link to comment Share on other sites More sharing options...
200p Posted September 24, 2011 Share Posted September 24, 2011 Laughs, nice to know how landords feel about their tenants! We hate everyone really. Quote Link to comment Share on other sites More sharing options...
Redcellar Posted September 24, 2011 Share Posted September 24, 2011 But it can really hurt you. I rented a place where the boyfriend and girlfriend had split. Turned out they used a residential mortgage but were letting it to me. Naughty. Overnight one decided they would buy the other halfs share and wanted to move back in in just a months time, verbal route not legal route. I needed a little longer to sort myself out so I dragged my heels and they tried verbally threatening, turning up at the front door. By now I knew there mortgage was residential, so I just dropped in the line that "did you get your mortgage statement I forwarded to you the other week, oh good". Suddenly penny drops and the guy realises the games up. "So are you sure two weeks more is enough for you to sort yourself out" he says, now as nice as pie. If I'd been a bad tennant I could have dragged that out for months or years. Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted September 24, 2011 Share Posted September 24, 2011 Laughs, nice to know how landords feel about their tenants! We hate everyone really. It's probably the word "landlord" that does it, gives them an inflated sense of their own importance . They're not all like that, though, my landlord considers me a valued customer. Quote Link to comment Share on other sites More sharing options...
Bruce Banner Posted September 24, 2011 Share Posted September 24, 2011 But it can really hurt you. I rented a place where the boyfriend and girlfriend had split. Turned out they used a residential mortgage but were letting it to me. Naughty. Overnight one decided they would buy the other halfs share and wanted to move back in in just a months time, verbal route not legal route. I needed a little longer to sort myself out so I dragged my heels and they tried verbally threatening, turning up at the front door. By now I knew there mortgage was residential, so I just dropped in the line that "did you get your mortgage statement I forwarded to you the other week, oh good". Suddenly penny drops and the guy realises the games up. "So are you sure two weeks more is enough for you to sort yourself out" he says, now as nice as pie. If I'd been a bad tennant I could have dragged that out for months or years. You missed the point. The was for the breathtaking arrogance of that particular poster, although I think she does it to wind us up, a classic troll. Quote Link to comment Share on other sites More sharing options...
piece of paper Posted September 24, 2011 Share Posted September 24, 2011 LOL It's quite incredible that banks loaned money to BTL in the first place. It's like walking into a casino and saying "extend me a credit line of 1 million please. If I win I keep all the money, if I lose you get nothing". It's a win win as you wrap it all up in a Ltd company and wash your hands of the failure. Absolute nuts. The dragons wouldn't even say "I'm out". They would say "are you having a f*cking laugh?" I think that a banker might recognise that concept and be quite sympathetic. p-o-p Quote Link to comment Share on other sites More sharing options...
ticket2ride Posted September 24, 2011 Share Posted September 24, 2011 Mug Punters "We need money to finance this great idea, renting out property!" The Institutional Investors "I'm out". Near me in SE13, I've noticed L&Q are disposing of traditional housing (terraced, semi etc) at auction. At the same time, they're throwing up huge developments such as this: http://www.lqgroup.org.uk/sales-and-rentals/our-properties/453/barge-walk/?SearchGUID=2011924103129 Bigger margins, guaranteed takers from housing lists and SO clients. Agree mug punters and picking up their crumbs. Quote Link to comment Share on other sites More sharing options...
Pent Up Posted September 24, 2011 Share Posted September 24, 2011 Looking at teh numbers. IO morgtage for BTL is stated as 3.59% (best deal they say!). So that's £448.75 / month Interest only And that's only on a £150,000 house. How do these numbers make any sense. Surely you can't make money once you start to save some aside for the capital repayments. They don't make sense once you account for all the associated costs. BTL doesn't make any financial sense without inflation busting capital gains. Quote Link to comment Share on other sites More sharing options...
Ash4781 Posted September 24, 2011 Share Posted September 24, 2011 (edited) £450pcm rent for a property that costs £45K in Hull sounds a little far fetched. That rents far too high. What does 'tenants lined up' mean ? Oh I see the letting agent gets a mention. Edited September 24, 2011 by Ash4781 Quote Link to comment Share on other sites More sharing options...
Redcellar Posted September 24, 2011 Share Posted September 24, 2011 You missed the point. The was for the breathtaking arrogance of that particular poster, although I think she does it to wind us up, a classic troll. I see. Probably just arrogance though. People are much more brazen about 'bending the rules'. They like calling it that. It sound nicer than fraudster, conman or criminal. Quote Link to comment Share on other sites More sharing options...
Ash4781 Posted September 24, 2011 Share Posted September 24, 2011 (edited) Depends on the maximum allowable housing benefit rate for a two bed, if it is £450 per month it is £450 per month, it is irrelevant what the property cost. For Hull and East Riding 'England Housing Benefit Rates weekly rate as of Jan 2012 for existing tenancies and April 2011 for new tenancies.' ;the rate is £380 per month or £85 per week. It doesn't sound like the policy would be value for money. In fact it's a terrible policy as in my head it would encourage landlords to get the cheapest (Assumed lowest quality) housing stock. THerefore the tenants have poor quality which the government also pays a high price for. Edited September 24, 2011 by Ash4781 Quote Link to comment Share on other sites More sharing options...
porca misèria Posted September 24, 2011 Share Posted September 24, 2011 Exactly, and in London the two bed rate is £290 per week and surprisingly the minimum rent for a two bed is around £290 per week. It is not the tenants who benefit it is landlords and because housing benefits are so high it also pushes up private rents as well - we 'competed' for a rental with someone on benefits, we offered £280 per week and the people on benefits just went straight in at £290 and got the property. I remember vividly my first experience of renting in London. Maggie had just brought down the level of housing support they'd pay. London: maximum £130/week for a single before they asked questions. The chattering classes whinged about hurting the poorest. So, a soft floor of £130/week. Meaning pretty-much anything below that was either Real Slum (common) or Real Philanthropist (rare). £130/week was also approximately the average gross income at the time. It was pretty-much exactly my income as a new graduate working in a central London software house and consultancy. And that was above average for new grads with a good degree in a supposedly-good subject. With the taxman taking £50 of that £130 in PAYE, we had a situation a whole lot worse than your £280 vs £290 Quote Link to comment Share on other sites More sharing options...
Bloo Loo Posted September 24, 2011 Share Posted September 24, 2011 Depends on the maximum allowable housing benefit rate for a two bed, if it is £450 per month it is £450 per month, it is irrelevant what the property cost. For Hull and East Riding 'England Housing Benefit Rates weekly rate as of Jan 2012 for existing tenancies and April 2011 for new tenancies.' ;the rate is £380 per month or £85 per week. so, in the article he got 75% mortgage at 4.45% IO which means £125 per month roughly so, If he goes for LA tenants he can expect £380 per month, IF the tenant passes on the money, leaving a wopping £260 per month. Course he has financed 3/4 of the deal himself with cash, so he says, of £11250.....plus fees and costs lest call it £14K. he appears to be already voided. And he isnt paying off a penny....could be Bardon has moved "Up North"? Quote Link to comment Share on other sites More sharing options...
GeordieAndy Posted September 24, 2011 Share Posted September 24, 2011 I have just spoke to Natwest as we are relocating and they have said as we have had a mortgage with them for over 3 years now we can get consent to lease for £100 and we can do that for the period of the mortgage and it will apply if we move onto their standard variable rate etc Now I'm really tempted to keep the house as we have a friend wanting to rent and we can better rates (4% repayment) than if we were going to have to move to a BTL deal etc. Over 10+ years from this point inflation alone surely makes this a good deal as someone will be paying our mortgage we don't need the £25k profit out of the house now (if we get a buyer). Decisions decisions... Quote Link to comment Share on other sites More sharing options...
Pindar Posted September 24, 2011 Share Posted September 24, 2011 If the mortgage was with Lloyds banking group then it's practically a council house. The government is paying its mortgage on a property which it lent itself the money to buy and then renting it back to itself. The BTL mug is given a cut but takes all the risk and the government gets to keep the house if it all goes pear shaped (repossession). I wish I had the power to create an obligation which people needed to buy essentials goods and services, especially if I got to keep the goods and services if the obligation couldn't be met. Quote Link to comment Share on other sites More sharing options...
Giordano Bruno Posted September 24, 2011 Share Posted September 24, 2011 It's probably the word "landlord" that does it, gives them an inflated sense of their own importance . They're not all like that, though, my landlord considers me a valued customer.I think it's probably true. Language and the feelings it can generate are funny. 'lord' especially. Consider 'drunk as a skunk' and 'drunk as a lord'. They conjure up quite different ideas and yet they mean the same.My LL is very good and he values me also. I've been with him as a tenant for about 16 years in three different flats. Quote Link to comment Share on other sites More sharing options...
Self Employed Youth Posted September 24, 2011 Share Posted September 24, 2011 If you are saving money with a B2L mortgage provider you are shooting yourself in your foot. Remove your savings and state the reason why. you must put your money where you mouth is to campaign against this evil. The majority of building societies have sold out. Get your money out and tell them why. FRB means your outbidding yourself by providing the B2Ltter a mortgage! or even mortgages. Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.