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City Watchdog Will Not Investigate Further...

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http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/10189292/No-evidence-of-widespread-interest-only-mortgage-mis-selling.html

'No evidence' of widespread interest-only mortgage mis-selling

The City watchdog has said it will not investigate further into whether interest-only mortgages were widely mis-sold.

The "vast majority" of borrowers with interest-only mortgage deals understood what they were taking on, the head of the City watchdog has said, further diminishing the chance of lenders facing mass claims for mis-selling.

_______

Eric .....

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http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/10189292/No-evidence-of-widespread-interest-only-mortgage-mis-selling.html

'No evidence' of widespread interest-only mortgage mis-selling

The City watchdog has said it will not investigate further into whether interest-only mortgages were widely mis-sold.

The "vast majority" of borrowers with interest-only mortgage deals understood what they were taking on, the head of the City watchdog has said, further diminishing the chance of lenders facing mass claims for mis-selling.

_______

Eric .....

Couldn't be any other way really, the "Key Facts Illustration" is critical here. I'm amazed that is only 'the vast majority' though.

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The "vast majority" of borrowers with interest-only mortgage deals understood what they were taking on, the head of the City watchdog has said, further diminishing the chance of lenders facing mass claims for mis-selling.

_______

Eric .....

I think I believe that. Vast majority probably knew what they were getting into but obviously do a reality distortion field when it did not work out the way they planned (i.e. sold the house for huge profit in 5 years)

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Endemeic fraud is OK then . Manipulation of markets, lie to buy, falsified accounts, falsified bank statesments, banks and building societies running dodgy loan apps through broker networks to secure business but hide risks from their own balance sheets or the packages of mortgages they sell on as investments.

We are not talking about one or two companies that did the above of a fews tens of intermediares. It was and probably still is wholesale and rife across the sector. Banks can do no wrong steal wealth with impunity.

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On the plus side hopefully people will be saved multiple telephone calls each day from yet another scam "were you sold an IO mortgage - was it missold - press telephone button ....".

Edited by billybong

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IO IO

its back from court we come

without a dime

for the bankers crime

IO IO IO IO.

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Endemeic fraud is OK then . Manipulation of markets, lie to buy, falsified accounts, falsified bank statesments, banks and building societies running dodgy loan apps through broker networks to secure business but hide risks from their own balance sheets or the packages of mortgages they sell on as investments.

We are not talking about one or two companies that did the above of a fews tens of intermediares. It was and probably still is wholesale and rife across the sector. Banks can do no wrong steal wealth with impunity.

Your post seems to be somewhat off-topic. The conclusion is that people who took out io mortgages knew exactly what they were doing.

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IO IO

its back from court we come

without a dime

for the bankers crime

IO IO IO IO.

No evidence of crime. I can't believe they had the cheek to claim ignorance of what loan they were taking out.

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No evidence of crime. I can't believe they had the cheek to claim ignorance of what loan they were taking out.

They werent looking for crime.

They were looking at the sales blurb.

They could also have checked a few for income mulitples on applications, forged signatures, no checks, etc etc....

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No evidence of crime. I can't believe they had the cheek to claim ignorance of what loan they were taking out.

It's not the type of loan, but the consequences of the loan.

IO is for bridging or where there's a repayment vehicle in place.

Banks should be compelled to ensure the repayment vehicle exists and is adequate.

Therefore a failure of the enablers - the regulators.

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Banks should be compelled to ensure the repayment vehicle exists and is adequate.

"If I exorcise my devils then my angels may leave too, and when they leave they're so hard to find." (Tom Waits - Please call me baby.)

We claim to have democracy and we claim to have free markets. Hence when an elected government allows borrowers to assess their own ability to repay and those borrowers count on HPI to do the repaying, you'll get a house price boom and then a shit ton of lousy loans lousing up the banking system.

The madness is that banks did ensure that the repayment vehicle existed - by lending into the bubble. The problem comes with the idea of adequacy - adequate for what, and when? It looks like the banks might be right - provided the might of the government is thrown behind their lending, we may be able to ensure that the repayment vehicle (HPI) was adequate. Of course with the rump of this crappy lending not hitting till 2030-ish, there are still many rivers to cross. In the meanwhile the collateral damage stemming from a state takeover of the housing market may end up being worse than the problem it was employed to fix.

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"If I exorcise my devils then my angels may leave too, and when they leave they're so hard to find." (Tom Waits - Please call me baby.)

We claim to have democracy and we claim to have free markets. Hence when an elected government allows borrowers to assess their own ability to repay and those borrowers count on HPI to do the repaying, you'll get a house price boom and then a shit ton of lousy loans lousing up the banking system.

The madness is that banks did ensure that the repayment vehicle existed - by lending into the bubble. The problem comes with the idea of adequacy - adequate for what, and when? It looks like the banks might be right - provided the might of the government is thrown behind their lending, we may be able to ensure that the repayment vehicle (HPI) was adequate. Of course with the rump of this crappy lending not hitting till 2030-ish, there are still many rivers to cross. In the meanwhile the collateral damage stemming from a state takeover of the housing market may end up being worse than the problem it was employed to fix.

I dont quite get your merging of repayment vehicle with the loan security.

One is a method of settling the debt within the terms of the agreement, for example, a monthly capital repayment.

The other is for disposal by force should the agreement fail.

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Banks should be compelled to ensure the repayment vehicle exists

Why?

If I lend cash to a person and take title deeds of his property as security, then he will either pay me back or I am at risk to the value of the collateral .

Other than the fraud that occurs if Lender claims it had done diligence when it hadnt and then sold the loan on to someone else then the lender has no duty to anyone to protect their own risks .

If you bought a bond issued by e.g republic of Greece or you lent money to a bank e.g RBS, have you committed a crime by not doing due diligence on their creditworthiness ??

Edited by Sir Harold m

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Don't see a problem with I/O mortgages except they seem to rolled out as a vehicle during times when house prices are booming as a means to increase affordability (and thus borrow more).

If it were currently possible for me to take out a I/O mortgage on my Council flat it would be cheaper for me to rent from the bank* than the Council (notwithstanding ongoing repair and maintenance charges) even taking into the account the current insane valuations made my estate agents on similar properties.

Obviously you take a gamble or an informed decision on the value at the end of the term

I know someone who is paying the same monthly on his I/O BTL mortgage on his 3 bed Romford semi, than I am in Council rent on a Northern one bed flat, though he did have substantial (one third) equity. Or was anyway. and he bought at the peak.

Apparently I'm the "subsidised" one.

*provided interest rates remain at current levels.

Edited by Secure Tenant

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Why?

If I lend cash to a person and take title deeds of his property as security, then he will either pay me back or I am at risk to the value of the collateral .

Other than the fraud that occurs if Lender claims it had done diligence when it hadnt and then sold the loan on to someone else then the lender has no duty to anyone to protect their own risks .

If you bought a bond issued by e.g republic of Greece or you lent money to a bank e.g RBS, have you committed a crime by not doing due diligence on their creditworthiness ??

All fine in theory until you have an army of aged, whinging borrowers trying to welsh on the deal come full term. It's impossible to turf out oldies to the street when they have en masse decided that they would rather stay in the same place after all.

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All fine in theory until you have an army of aged, whinging borrowers trying to welsh on the deal come full term. It's impossible to turf out oldies to the street when they have en masse decided that they would rather stay in the same place after all.

Thats the problem like those weird mortgages where the banks gained the equity (can't remember what they were called). Of course there would have been no complaints had house prices fallen, however they rose so they were "missold."

Can't turn the TV these days without seeing some aged, wizzened looking twit whining because they hadn't studied the contract terms and small print.

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Thats the problem like those weird mortgages where the banks gained the equity (can't remember what they were called). Of course there would have been no complaints had house prices fallen, however they rose so they were "missold."

Can't turn the TV these days without seeing some aged, wizzened looking twit whining because they hadn't studied the contract terms and small print.

Ah yes those RBS deals, can't remember the name either.

I'm not sure it's a case of failure to read the small print versus just changing their minds once it becomes time to leave their home, friends and locale. Perfectly understandable that they would wish to stay, but hardly unforseeable to the point you'd write off the option by taking IO a couple of decades prior. "My home is not my pension after all".

If it becomes fashionable to open a tab on council tax, then heating bills aside, home and dry(and the same could be done with the gasman I'm sure).

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All fine in theory until you have an army of aged, whinging borrowers trying to welsh on the deal come full term. It's impossible to turf out oldies to the street when they have en masse decided that they would rather stay in the same place after all.

Then they have to keep paying the interest on their debt up to the point that they die. At least the property will probably have gone up in value.

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  • 238 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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