BubblesBurst Posted January 21, 2006 Share Posted January 21, 2006 The Co-Operative bank is now offering up to 4 times your joint earnings if you and the person you are buying with are both graduates and both earning over £20,000 each year ! Application fee £399 and they must be between 21 and 45. This is crazy and desperate, I hope that all that education has been worthwhile and that they won't be suckered into this madness. You can't teach commonsense to people. What next to keep HPI going ? Quote Link to comment Share on other sites More sharing options...
Mags Posted January 21, 2006 Share Posted January 21, 2006 The Co-Operative bank is now offering up to 4 times your joint earnings if you and the person you are buying with are both graduates and both earning over £20,000 each year ! Application fee £399 and they must be between 21 and 45. This is crazy and desperate, I hope that all that education has been worthwhile and that they won't be suckered into this madness. You can't teach commonsense to people. What next to keep HPI going ? I got that leaflet too - was really disappointed in the Coop. Not exactly what I'd expect from a company that claims to have 'fairness' at heart. Quote Link to comment Share on other sites More sharing options...
BubblesBurst Posted January 21, 2006 Author Share Posted January 21, 2006 I got that leaflet too - was really disappointed in the Coop. Not exactly what I'd expect from a company that claims to have 'fairness' at heart. Yes exactly and "Helping you do the right thing with your money" Right thing for who ? You shouldn't take out a mortgage for more than 3.5 times your salary. That is the only affordable amount, any more and you are seriously over paying for a property or looking beyond your means if you need a mortgage to buy. It's simple. Quote Link to comment Share on other sites More sharing options...
Fancypants Posted January 21, 2006 Share Posted January 21, 2006 The Co-Operative bank is now offering up to 4 times your joint earnings if you and the person you are buying with are both graduates and both earning over £20,000 each year ! Application fee £399 and they must be between 21 and 45. This is crazy and desperate, I hope that all that education has been worthwhile and that they won't be suckered into this madness. You can't teach commonsense to people. What next to keep HPI going ? hey, me & 'er indoors qualify for this! Excuse me, I'm off to browse Rightmove Quote Link to comment Share on other sites More sharing options...
boom_and_bust Posted January 21, 2006 Share Posted January 21, 2006 (edited) Hi, Yes, yet another example of 'ethical' British companies who are very quick to jump down the throats of globalised corporations, or despot governments overseas or lay their bleeding hearts on their sleeve for baby whales swimming up the thames, confused by the affects of global warming and poor lentil crops in the Sudan. They usually splash their hypocracy all over the sunday supplements of the Independent and Guardian. Ignore their marketing hypocracy. They are no different in motives to any other company out there, they just try to pretend they are. They should just stop the marketing charade and try to compete on real issues with their high street competitors (like price, service quality, etc), IMHO. Hummm, 8*times income mortgages, very ethical. If it was happening somewhere else in the world they would be 'tut, tutting' all the way, you can be sure. Boomer Edited January 21, 2006 by boom_and_bust Quote Link to comment Share on other sites More sharing options...
Fancypants Posted January 21, 2006 Share Posted January 21, 2006 To see things from the other side for a moment... in all fairness, this mortgage would seem to present some attractive options to someone like me. Prices seem to have come off a bit, and at the purchasing power that it would give me & our lass, we could actually get somewhere perfectly reasonable where we would be fairly happy to live. Looked at superficially, by someone with our means and who hadn't considered things as we do on this site, it might encourage them to dive in... However, this does not take account of: neither partner would be able to stop working, whether to raise children or to endure a period of joblessness. Nor would there be any slack to afford childcare, were they so inclined. they would be exposed to even marginal increases in IRs they would never be able to upgrade. it may suit a childless working couple, but where do you go from there? Only a windfall, a sudden increase in earnings or general wage inflation could change this. The latter would undoubtedly be accompanied by higher IRs which would cripple the homeowner first. Quote Link to comment Share on other sites More sharing options...
Converted Lurker Posted January 21, 2006 Share Posted January 21, 2006 Guys, with respect, are we not in danger of dissing everything for dissings sake? What if this...what if that...supposing the sky fell in? 4 x joint salary if you earn over 20K each, hardly dangerous or extreme is it? A couple earn 44K between them, are they not worth a 180K mortgage? They bring in approx. 3K between them, 1K on the mortgage, the traditional third of wages metric? Quote Link to comment Share on other sites More sharing options...
slowjoe Posted January 21, 2006 Share Posted January 21, 2006 it may suit a childless working couple, but where do you go from there? Only a windfall, a sudden increase in earnings or general wage inflation could change this. The latter would undoubtedly be accompanied by higher IRs which would cripple the homeowner first. I suspect that a pair of graduates would have a reasonable expectation that at least one of them would get significant pay rises in the coming years. On that basis, I don't think that it's hugely out of line from the Co-op. Whether significant numbers of people take them up is another matter. Quote Link to comment Share on other sites More sharing options...
Fancypants Posted January 21, 2006 Share Posted January 21, 2006 I suspect that a pair of graduates would have a reasonable expectation that at least one of them would get significant pay rises in the coming years. On that basis, I don't think that it's hugely out of line from the Co-op. Whether significant numbers of people take them up is another matter. that's the lender's rationale for sure. However, there's an awful lot of graduates out there, many of which are of highly dubious quality. I may well even be one of them, the jury is still out! this smacks of IO mortgages being rolled out to unsuitable borrowers... lawyers, doctors, fine. But by graduates, do they include someone with a cultural studies degree from Redcar Poly who has got themselves a £21k position in local government with limited prospects for big wage hikes? Quote Link to comment Share on other sites More sharing options...
Casual Observer Posted January 21, 2006 Share Posted January 21, 2006 You shouldn't take out a mortgage for more than 3.5 times your salary. That is the only affordable amount, any more and you are seriously over paying for a property or looking beyond your means if you need a mortgage to buy. It's simple. Do you think that multiple should be fixed for ever? Regardless of IR's? It was about that limit when I first bought, in 1975, at 11%. Guys, with respect, are we not in danger of dissing everything for dissings sake? What if this...what if that...supposing the sky fell in? 4 x joint salary if you earn over 20K each, hardly dangerous or extreme is it? A couple earn 44K between them, are they not worth a 180K mortgage? They bring in approx. 3K between them, 1K on the mortgage, the traditional third of wages metric? Back in the 70's a rule of thumb was that monthly mortgage repayments should not be higher than 1 week's gross income. Quote Link to comment Share on other sites More sharing options...
Fancypants Posted January 21, 2006 Share Posted January 21, 2006 Do you think that multiple should be fixed for ever? Regardless of IR's? It was about that limit when I first bought, in 1975, at 11%. Back in the 70's a rule of thumb was that monthly mortgage repayments should not be higher than 1 week's gross income. which is why all this seems perfectly reasonable on a current affordability basis. Hell, I even had a look at the sort of things it could buy me & mine in London and was pleasantly surprised. Thing is, it sets up a whole world of potential pain... that was my point, it's dastardly and deceptive (not Co-op's fault though) Quote Link to comment Share on other sites More sharing options...
Casual Observer Posted January 21, 2006 Share Posted January 21, 2006 which is why all this seems perfectly reasonable on a current affordability basis. Hell, I even had a look at the sort of things it could buy me & mine in London and was pleasantly surprised. Thing is, it sets up a whole world of potential pain... that was my point, it's dastardly and deceptive (not Co-op's fault though) I think the problem is that so many people try to buy a house on 1 income. I couldn't have done so when I first bought - and I was quite well paid. I don't know anyone who did in the 70s Quote Link to comment Share on other sites More sharing options...
Fancypants Posted January 21, 2006 Share Posted January 21, 2006 I think the problem is that so many people try to buy a house on 1 income. I couldn't have done so when I first bought - and I was quite well paid. I don't know anyone who did in the 70s well, my father did in 1970, 1974, 1982 (twice) and 1996. Although this was in the (then) bleak windswept North Country. I would say he was probably an average earner for the time... skilled manual. I understand from my older colleagues at work that it was quite common down here too - although they were on very good money back then (not now, obviously, being my colleagues! ) Quote Link to comment Share on other sites More sharing options...
FreeFall Posted January 21, 2006 Share Posted January 21, 2006 (edited) Back in the 70's a rule of thumb was that monthly mortgage repayments should not be higher than 1 week's gross income. And here lieth the problem. When I last spoke to a mortgage broker I found that I could borrow an amount with repayments that represented 50% of my take home salary.... Edit: Flippin typos... Edited January 21, 2006 by FreeFall Quote Link to comment Share on other sites More sharing options...
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