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Fca - New Mortgage News - (Merged Topics)

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My fault for using the word deal. I bought my house 10 years ago. On a 25 year mortgage. But every 5 years, my fixed rate, runs out, its about to do so again and i can fix for another 5 years at 4%. What i'm wondering is, this is usually easy to do online, are we now saying that half way thru a 25 year mortgage I will have to go over coals to fix my rate?

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The issue is that after a decade of real wage erosion, with little evidence of a substantial shift for the better, is it a given that people will be in a better position at renewal than when they take out the loan today at series lows in rates? The 70s mindset would melt at the prospect of someone looking to remortgage after 15 years with problematic nominal debt levels after years of strong house price and wage inflation, with wages ahead of prices by 4 or 5% some years. Today's landscape may be of someone remortgaging with wages lagging RPI by 2 or 3% for the same period, and without nominal prices having changed much either.

Banks could of course resolve this entirely by offering fixes for the whole mortgage term, but something about their business model makes this an unattractive option..

I'm not sure MMR will make much difference if only because absolutely nothing but hot air has been created in the wake of the financial crisis(except putting legions of financial sector employees in clover and 7 years closer to collecting retirement pots) and it would be daft to suppose any different this time. MMR goes totally against the grain of Osborne's stated mission of a 200 basis point rise in household debt:earnings in the next 5 years.

Time will tell...

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Making tea.

Absolute 80s on.

There's a new FCA advert - Can you afford your mortgage????? There's new lending rules coming in end of this month. Don't forget about council tax etc etc etc.

Makes a change after listening to countless 'Your money is safe with the FCA looking on'.

http://www.fca.org.uk/consumers/financial-services-products/mortgages/mortgage-market-review

'In the past, some people were allowed to take out a mortgage they could not afford. This led to some of them falling behind with their payments or losing their home.'

You don't say . . .

Here's the rules:

http://www.fca.org.uk/consumers/financial-services-products/mortgages/mortgage-market-review/affording-a-mortgage

Christ. Nevermind whether you can afford the mortgage or not, just filling in the form will kill the market.

I call Pop! end of this week, 26th April, when these rules come in.

Do you think lenders will very cautious if not over cautious to prevent mis-selling claims in the future.

Edited by awaytogo

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Do you think lenders will very cautious if not over cautious to prevent mis-selling claims in the future.

Quite. And the FCA will still be keeping an eye open for anyone egregiously taking advantage of the bedding down period.

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Quite. And the FCA will still be keeping an eye open for anyone egregiously taking advantage of the bedding down period.

how many staff do they have?

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My fault for using the word deal. I bought my house 10 years ago. On a 25 year mortgage. But every 5 years, my fixed rate, runs out, its about to do so again and i can fix for another 5 years at 4%. What i'm wondering is, this is usually easy to do online, are we now saying that half way thru a 25 year mortgage I will have to go over coals to fix my rate?

Depends.. if it's a repayment mortgage then you'll have paid off a fair chunk by now anyway.

In any case I suspect it'll be applied more rigorously to new entrants.

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Depends.. if it's a repayment mortgage then you'll have paid off a fair chunk by now anyway.

In any case I suspect it'll be applied more rigorously to new entrants.

Its a total new ball game this new mortgage affordability test, will they take into account equity you already have in the property when aplying for a new term mortgage when your last term runs out.

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Ooh first article on the news this morning (Friday) on R4 PM @ 6am

Homeowners face new checks before they take out a mortgage.

Making it sound like an ******** probe.

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Ooh first article on the news this morning (Friday) on R4 PM @ 6am

Homeowners face new checks before they take out a mortgage.

Making it sound like an ******** probe.

The stars were lana otherway round.

Really downbeat article.

By the way, has anyone found any updated mortgage calculators on the web yet?

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This is BBC Breakfast's lead story this morning -'How getting a mortgage is about to get tougher' - saying how unfair it is that people may get rejected for mortgages based on their spending behaviour. Anyway...

1) why does this seem unreasonable to ppl? If I lent a mate £50, I'd want to know if they just planned to gamble it up the wall...

2) Can't the system just be scammed and the applicant just answer £0 to how much they spend on gyms, gambling, milk deliveries?

3) As an aside, it's interesting that banks now assess applicants general spending at the expense of how much they'll offer you a mortgage for - like they expect us to prioritise a mortgage above anything/everything else. Why is this country so obsessed with walking blindly into debt-serfdom!!

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This is BBC Breakfast's lead story this morning -'How getting a mortgage is about to get tougher' - saying how unfair it is that people may get rejected for mortgages based on their spending behaviour. Anyway...

1) why does this seem unreasonable to ppl? If I lent a mate £50, I'd want to know if they just planned to gamble it up the wall...

2) Can't the system just be scammed and the applicant just answer £0 to how much they spend on gyms, gambling, milk deliveries?

3) As an aside, it's interesting that banks now assess applicants general spending at the expense of how much they'll offer you a mortgage for - like they expect us to prioritise a mortgage above anything/everything else. Why is this country so obsessed with walking blindly into debt-serfdom!!

2) I would guess they'll want to see your bank account statements for a couple of years. A credit search will pick up all other loans - car finance, store cards, etc. If you fib about not having any other debt then I would expect the application to be rejected.

Christ, the 6.15 money section's just come on.

Raking over it again.

7% if the magic mortgage figure.

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Ooh first article on the news this morning (Friday) on R4 PM @ 6am

Homeowners face new checks before they take out a mortgage.

Making it sound like an ******** probe.

Yes on fivelive too. As I posted the other day I am not sure what mortgage brokers and the lenders were doing before? It appears for some not much! Debt is risk free though (the bank can repo). Also they would expect you to scrimp(beans for dinner?) to pay the mortgage first. They area very close to exposing the problem of the lack of real take home increases as they are suggesting the affordability will worsen in the future Over the mortgage term. Not news to most at 0.5% interest rates ! However, I presume they are not inflating the salaries for the calc? (0 wage increases)

One example from a broker said a guy on 20k would be loaned 70k on old system but now something like £59k (I think he said). Whether they have really killed the income multiplier modelling is interesting?

Edited by Ash4781

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Yes on fivelive too. As I posted the other day I am not sure what mortgage brokers and the lenders were doing before? It appears for some not much! Debt is risk free though (the bank can repo). They area very close to exposing the problem of the lack of real take home increases as they are suggesting the affordability will worsen in the future Over the mortgage term. Not news to most at 0.5% interest rates ! However, I presume they are not inflating the salaries for the calc?

No, its not, not by a long shot.

Repos are very expensive.

The house might be a woth a lot less than the debt on it.

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Just switched the TV on and a woman on BBC news was complaining that her mortgage offer had been cut back because she had recently bought a car on HP........... "So much paperwork and a lot of financial jargon".

This was followed by a mortgage broker saying that it........ "It would seem Seem very unfair for some lenders to reduce how much someone can borrow based on how much the spend on other things".

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I was offered max 3.72 gross single income with no debts or other outgoings. This was with YBS who l understand had already adopted the new regs from earlier this month.

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Just switched the TV on and a woman on BBC news was complaining that her mortgage offer had been cut back because she had recently bought a car on HP........... "So much paperwork and a lot of financial jargon".

This was followed by a mortgage broker saying that it........ "It would seem Seem very unfair for some lenders to reduce how much someone can borrow based on how much the spend on other things".

yeah lol right?

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Just switched the TV on and a woman on BBC news was complaining that her mortgage offer had been cut back because she had recently bought a car on HP........... "So much paperwork and a lot of financial jargon".

This was followed by a mortgage broker saying that it........ "It would seem Seem very unfair for some lenders to reduce how much someone can borrow based on how much the spend on other things".

I've been watching this report too. Been on twice so far. Not one commentator is mentioning that this supposed new groundbreaking legislation is only going back the traditional lending criteria that banks and building societies used before the madness of the past 20 odd years.

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Just switched the TV on and a woman on BBC news was complaining that her mortgage offer had been cut back because she had recently bought a car on HP........... "So much paperwork and a lot of financial jargon".

This was followed by a mortgage broker saying that it........ "It would seem Seem very unfair for some lenders to reduce how much someone can borrow based on how much the spend on other things".

Oooh genius!

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I've been watching this report too. Been on twice so far. Not one commentator is mentioning that this supposed new groundbreaking legislation is only going back the traditional lending criteria that banks and building societies used before the madness of the past 20 odd years.

TRUE the old system worked ok. it is unbelievable that people are against a scheme that stops them overloading on debt,

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  • 399 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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