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Pebbles

Supersized mortgages are back

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Article below that shows that far from Lending tightening up post MMR it has actually gotten looser. Now FTB are borrowing 3.68x income instead of 3.39x income in summer 2007. I was also promised by some on here that greater than 4.5 x mortgages were a no no again this is debunked.

https://www.dailymail.co.uk/news/article-6427491/Supersized-mortgages-back.html

As a side note I have just undergone a mortgage application and certainly 5x income was attainable with little effort. The affordability assessment was a joke, no evidence at all required and I could self certify my outgoings (but not incomings). If people really do believe credit is tightening then fair enough but that's not what i see out there the taps are full on out there and the BOE are complicit in just waving it through.

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19 minutes ago, Freezer? Best place for it said:

Increased LTI,  Gig economy, productivity shot, Workers rights under threat etc.  - but an Independent BoE, God bless you Sir.

Quite the BoE's independence is a bit of a joke merely a convenient lie to allow their actions or lack of to face less scrutiny.

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2 hours ago, Pebbles said:

As a side note I have just undergone a mortgage application and certainly 5x income was attainable with little effort. The affordability assessment was a joke, no evidence at all required and I could self certify my outgoings (but not incomings). If people really do believe credit is tightening then fair enough but that's not what i see out there the taps are full on out there and the BOE are complicit in just waving it through.

Three years ago I wasn't even asked about my outgoings.

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38 minutes ago, Riedquat said:

Three years ago I wasn't even asked about my outgoings.

Same here just after MMR came in. I think someone with a high credit score got to bypass all the checks on outgoings/accounts, just 3 payslips required.

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52 minutes ago, Riedquat said:

Three years ago I wasn't even asked about my outgoings.

 

12 minutes ago, Andy T said:

Same here just after MMR came in. I think someone with a high credit score got to bypass all the checks on outgoings/accounts, just 3 payslips required.

Could it be because you had low LTV?  I appreciate you might not want to share that.

 

3 hours ago, Pebbles said:

Article below that shows that far from Lending tightening up post MMR it has actually gotten looser. Now FTB are borrowing 3.68x income instead of 3.39x income in summer 2007. I was also promised by some on here that greater than 4.5 x mortgages were a no no again this is debunked.

https://www.dailymail.co.uk/news/article-6427491/Supersized-mortgages-back.html

As a side note I have just undergone a mortgage application and certainly 5x income was attainable with little effort. The affordability assessment was a joke, no evidence at all required and I could self certify my outgoings (but not incomings). If people really do believe credit is tightening then fair enough but that's not what i see out there the taps are full on out there and the BOE are complicit in just waving it through.

So depressing.

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1 minute ago, iamnumerate said:

 

Could it be because you had low LTV?  I appreciate you might not want to share that.

 

So depressing.

It is depressing, fortunately I didn't want much I tried asking for as bigger mortgage as I could for intestes sake then decided i didn't need it. The banks seem disappointed if you refuse to borrow to near your max, I couldn't do that because I would worry every day my mortgage is bigger than my liquid assets to pay it off.

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3 hours ago, Pebbles said:

Article below that shows that far from Lending tightening up post MMR it has actually gotten looser. Now FTB are borrowing 3.68x income instead of 3.39x income in summer 2007. I was also promised by some on here that greater than 4.5 x mortgages were a no no again this is debunked.

https://www.dailymail.co.uk/news/article-6427491/Supersized-mortgages-back.html

As a side note I have just undergone a mortgage application and certainly 5x income was attainable with little effort. The affordability assessment was a joke, no evidence at all required and I could self certify my outgoings (but not incomings). If people really do believe credit is tightening then fair enough but that's not what i see out there the taps are full on out there and the BOE are complicit in just waving it through.

Thast not what I experienced when I remortgages 2 years ago with HSBC.

They checked everything. Wanted copies of bills, partners income and spend.

And this was for a 0.8 LTE 5 year fix.

 

 

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39 minutes ago, Andy T said:

Same here just after MMR came in. I think someone with a high credit score got to bypass all the checks on outgoings/accounts, just 3 payslips required.

Whic bank?

The smaller ones might be so depserate for business they are willign to bypass the rules.

The problems will come if/when the loan goes bad and the BoE checks the loan to find its not been MMR verfiied.

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Stretching my memory back now I think they wanted a couple of bank statements but no more, which doesn't necessarily give much of an idea of typical spend. 66% LTV.

This was a major bank.

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i took a mortgage out in 2003 and was asked for 3x payslips. i made sure i took a set which had plenty of overtime and other payments on them.  

they offered me 150k pretty sure it was only 3.5x earnings 

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2 minutes ago, longgone said:

i took a mortgage out in 2003 and was asked for 3x payslips. i made sure i took a set which had plenty of overtime and other payments on them.  

they offered me 150k pretty sure it was only 3.5x earnings 

I got 4.1 times in 2001 and it was over 80% LTV so your mortgage company was very responsible.

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1 hour ago, iamnumerate said:

 

Could it be because you had low LTV?  I appreciate you might not want to share that.

 

 

56 minutes ago, spyguy said:

Whic bank?

The smaller ones might be so depserate for business they are willign to bypass the rules.

The problems will come if/when the loan goes bad and the BoE checks the loan to find its not been MMR verified.

It was 85% LTV so pretty high. Roughly 4x joint earnings, 25 years. 

It was Barclays/Woolwich. Prior to applying I researched a little to find the lenders that cropped up often as refusing applications on grounds of outgoings/existing loans/spending patterns/childcare costs etc. Barclays/Woolwich never really cropped up as a complaint.

They tried to encourage us to lend more than we needed but over 35 years instead of 25, saying things like 'why don't you keep some of your deposit for furnishing the house, new kitchen, repairs etc. etc.

They were surprised that we'd even heard of MMR.

 

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My friends son has just managed to get a mortgage with Metro Bank. He’s 22yrs old, FTB on an annual income of £28,000 & has had a mortgage offer for £240,000. The purchase price of the property s £270,000

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44 minutes ago, JohnLondon said:

My friends son has just managed to get a mortgage with Metro Bank. He’s 22yrs old, FTB on an annual income of £28,000 & has had a mortgage offer for £240,000. The purchase price of the property s £270,000

Was help to buy involved?

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I’ve been saying this for years on here but seems to fall on deaf ears. My partner and I are low earners and got 5X joint income mortgage with Santander through which mortgage brokers in a couple of days. The broker said it’s a systems led process?? All we needed was 1 payslip and 3 bank statements.

remortaged with Habeto (online broker) even less info needed didn’t even have to sign or post anything.

my guess is the boe and banks want to appear to be sensible with lending but know if they are they will cause a decline in mortgages.

MMR all smoke and mirrors.

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2 hours ago, JohnLondon said:

My friends son has just managed to get a mortgage with Metro Bank. He’s 22yrs old, FTB on an annual income of £28,000 & has had a mortgage offer for £240,000. The purchase price of the property s £270,000

Where'd the 30k deposit come from and is he buying on his own?

Irritatingly i posted this same story (but via the guardian) a day or two ago but the moderators didnt approve it :(

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3 hours ago, JohnLondon said:

My friends son has just managed to get a mortgage with Metro Bank. He’s 22yrs old, FTB on an annual income of £28,000 & has had a mortgage offer for £240,000. The purchase price of the property s £270,000

Just done the maths on this.  Monthly payments on the best 2 year fixed deal I could find at 1.79% are £993.  Monthly after tax income is £1,869.  So more than 50% of take home pay spent on debt service.

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I always felt that the return of 120% mortgage would be the sure sign that the market is heading for crash again, because it really detaches house price completely from income. I am not seeing 120% mortgage, so I think the market won't quite blow up yet. But I do read the news that banks want to bring back 120% mortgage, so maybe we are not that far.

  

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5 minutes ago, peter_2008 said:

I always felt that the return of 120% mortgage would be the sure sign that the market is heading for crash again, because it really detaches house price completely from income. I am not seeing 120% mortgage, so I think the market won't quite blow up yet. But I do read the news that banks want to bring back 120% mortgage, so maybe we are not that far.

  

I think lending 9x gross income is as barking as a 120% mortgage. 

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5 hours ago, JohnLondon said:

My friends son has just managed to get a mortgage with Metro Bank. He’s 22yrs old, FTB on an annual income of £28,000 & has had a mortgage offer for £240,000. The purchase price of the property s £270,000

OMG 

 

quarter million debt just 6 years after leaving school.  that will be more than half his income.  NUTS

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9 minutes ago, Kurt Barlow said:

I think lending 9x gross income is as barking as a 120% mortgage. 

I feel high multiplier is rather a reflection of ultra low interest rate (say when interest rate drops from 6% to 2%, a repayment mortgage monthly payment goes down by 30%, so people can borrow more); whereas 120% mortgage would be a better reflection of sheer insanity.

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