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iamconfusedagain

Lenders Are Doing Their Bit

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http://business.timesonline.co.uk/article/...1889310,00.html

Oh the banks are so good to us

.........is expected to benefit first-time buyers by helping them to borrow larger amounts.

It just sounds like an advert for really foolish borrowing to me

I like this..

“If you borrow more than the value of your home, you will be in negative equity, so you need to be sure that you will live in the property for at least five years to give it a chance to grow in value.”

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However, Ms Bien cautions against basing your decision on housing market predictions. “If you are ready to buy now, don’t put it off,” she says. “Many buyers try to predict the market, but few get it right. If you have done the sums and can afford it fairly comfortably, then you should do it, instead of trying to be clever by holding off.”

Afford what exactly? What you would reasonably expect, or a load of old rubbish?

She obviously is the owner of this house and can't sell:

Value for money.

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You're all wrong...

It's part of:

A new trend in affordability lending

Just don't try and be clever!

Can any one find out where Rebecca O’Connor lives, I'd like to shoot her.

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What was the point of the case study at the end?

It didn't say how much the couple earned, what their deposit was or how much the repayments were. It lacked all the important information needed to make an informed decision.

I notice it did say how much the house was and how low the IR was.

Was this just a case of saying LOOK - here is a young couple buying a house for £195K - if they can so can you.

Unbelievable

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I find this article distasteful for a number of reasons :-

tough to get on the property ladder

Property as a "ladder" simply DOES NOT EXIST any more in a low inflation and high-debt environment. When are people going to cotton on to this ?

"Now is a good time to buy because prices are more realistic"

It's just yet another "never been a better time to buy" tactic to suck in the last of the gullibles. The lenders will be attempting this all the way down to the bottom.

And, as far as prices go - they are presently entirely divorced from realism from North to South, and have been for the last 3-4 years for first time buyers. A year or so of slower growth does not in any way compensate for several years of an out-of-control bubble.

"you should do it, instead of trying to be clever by holding off"

A direct poke at those of us on this forum who want to see house prices fall back to more reasonable levels, because that is the ONLY way to really help first time buyers.

benefit first-time buyers by helping them to borrow larger amounts

It'll just get them into even scarier and larger amounts of debt. It's time for these irresponsible lending practices to stop. Self-cert in particular is the most massive and blatant financial fraud I can think of, and yet the Government and law enforcement turn a blind eye.

live in the property for at least five years to give it a chance to grow in value

Only five years ? After the last crash it took longer than that for many to get out of Negative Equity. And house prices are going nowhere. In five years, I think they will definitely be lower than they are today.

In summary, this is an atrocious article which is designed to fleece the young people of this country.

Everyone, it seems, is out to destroy the lives of young people and their young families, to saddle them with huge amounts of debt to get on a property "ladder" that no longer actually exists.

I hope that most people don't fall for this utter drivel.

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http://business.timesonline.co.uk/article/...1889310,00.html

Oh the banks are so good to us

It just sounds like an advert for really foolish borrowing to me

I like this..

Quote "A new trend in affordability lending, whereby lenders will assess how much a borrower can afford based on income and expenditure instead of working on salary multiples, is expected to benefit first-time buyers by helping them to borrow larger amounts. "

Lenders have asked for income and expenditure information for ages. What's new about this?

Did I disclose stuff about my expenditure needlessly when I applied for my mortgage back in the 20th Century?

****, if you don't mind me saying so.

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Quote "A new trend in affordability lending, whereby lenders will assess how much a borrower can afford based on income and expenditure instead of working on salary multiples, is expected to benefit first-time buyers by helping them to borrow larger amounts. "

Lenders have asked for income and expenditure information for ages. What's new about this?

Did I disclose stuff about my expenditure needlessly when I applied for my mortgage back in the 20th Century?

****, if you don't mind me saying so.

This is exactly the sort of article HPC should rebut. I might give it a go using the WIKI when I'm bored at work on Monday but perhaps some of you hardliners should demonstrate your commitment to the cause by doing it before then.

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Ms Bien cautions against basing your decision on housing market predictions. “If you are ready to buy now, don’t put it off,” she says. “Many buyers try to predict the market, but few get it right.

Five points if you can spot the contradiction in that statement. <_<

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This is one of the worst pieces of 'journalism' I've ever read - the property equivalent of a Paul Ross movie review.

I've highlighted the segments which are blatent plugs for mortgage lenders in red. Everthing else is IMHO just plain bad advice.

Maybe I should have just made the whole thing brown. ;)

FIRST-TIME buyers have had it hard over the past few years. Rising house prices and competition for smaller properties from buy-to-let investors have made it tough to get on the property ladder.

But low interest rates and slower growth in house prices have revived interest and lenders are responding with deals that give aspiring homeowners a leg-up. Melanie Bien, of Savills Private Finance, the mortgage broker, says: “Now is a good time to buy because prices are more realistic and there are fewer buyers.”

However, Ms Bien cautions against basing your decision on housing market predictions. “If you are ready to buy now, don’t put it off,” she says. “Many buyers try to predict the market, but few get it right. If you have done the sums and can afford it fairly comfortably, then you should do it, instead of trying to be clever by holding off.”

A new trend in affordability lending, whereby lenders will assess how much a borrower can afford based on income and expenditure instead of working on salary multiples, is expected to benefit first-time buyers by helping them to borrow larger amounts.

Some deals allow first-time buyers to borrow up to 130 per cent of a property’s value, but such deals have higher interest rates. They are also risky. Simon Tyler, of Chase De Vere Mortgage Management, another broker, explains: “If you borrow more than the value of your home, you will be in negative equity, so you need to be sure that you will live in the property for at least five years to give it a chance to grow in value.”

Buying with friends is becoming more popular, but there could be complications if one person decides to move out. Cath Hearnden, of My Mortgage Direct, another broker, says: “You must draw up the legal paperwork first to avoid problems later.”

Britannia Building Society has a Share-to-Buy mortgage available to graduates. It will lend up to three times the salaries of four people and also offers a free legal agreement.

The usual source of help for first-time buyers is still their parents. If they act as guarantors, the mortgage will be cheaper and more flexible, Ms Bien says. She adds: “You do not have to have a specific guarantor mortgage. Most lenders will allow guarantors across their whole range.”

Some lenders take account of parental income. The Bank of Ireland’s 1st Start scheme offers buyers an income multiple of four times parents’ salaries after the parents’ existing mortgage payments have been deducted, plus one times the child’s salary.

Alternatively, the whole family can pitch in with a deal from Newcastle Building Society, which will offset the savings of family members against the child’s mortgage, reducing the repayments or the mortgage term.

A straightforward way for parents to help is by paying some of the deposit. A sizeable deposit will also avoid higher-lending charges (HLCs), which some lenders impose even on first-time buyer mortgages that offer high loan-to-value (LTV) percentages.

Abbey launched two new first-time buyer deals this week, offering up to 97 per cent LTV. But if you borrow more than 90 per cent, the bank still demands a higher-lending charge.

Mr Tyler says: “Northern Rock, Nationwide and Cheltenham & Gloucester tend not to charge HLCs but then the rates are higher to reflect that. An HLC can often be added to the loan so it can be mitigated as an upfront expense.”

If you are put off by fees, Mr Tyler recommends a 100 per cent three-year fixed-rate deal from Yorkshire Building Society at 5.49 per cent, with no HLC. Legal and valuation work is free and you can opt to have no arrangement fee or receive 0.6 per cent cash back.

Competitive first-time buyer deals are also available from the Woolwich, the Co-operative Bank, Portman Building Society and Northern Rock.

Case study

TOM BATT, 24, and Mawgan Paxton, 25, decided to buy their own home because they were sick of paying rent, Rebecca O’Connor writes. But obtaining a mortgage on the £195,000 three-bedroom London apartment that they are buying proved to be more complicated than expected.

Their first application fell through when it emerged that the apartment block did not meet the lender’s conditions. Tom, an analyst for an investment bank, and Mawgan, a seminar manager, eventually obtained a flexible two-year fix from Abbey at 5.14 per cent, with a £399 arrangement fee and free valuation. Mawgan says: “We intend to make overpayments, so were willing to sacrifice a low rate for flexibility.”

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This is one of the worst pieces of 'journalism' I've ever read - the property equivalent of a Paul Ross movie review.

I've highlighted the segments which are blatent plugs for mortgage lenders in red. Everthing else is IMHO just plain bad advice.

Maybe I should have just made the whole thing brown. ;)

Looking at the article, there are a number of links to various financial services:

Money Shop: Shop for a mortgage, a loan, a credit card.

Mortgages: Finding the right mortgage for you, sponsored by Bradford and Bingley.

Current accounts.

Loans: How much do you want ot borrow?

Credit cards.

Share dealing.

Utility providers.

Who's paying for this article?

Doesn't it say exactly what you'd expect it to say?

Edited by BandWagon

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  • 302 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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