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Panic to buy before redundancy


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Have noticed an uptick in the property market right now... and a good proportion of my friends and colleagues are worried about redundancy.

If you're made redundant then surely there's quite a wait before you can qualify once more for a mortgage... depending on the length of interruption - the type of work you move in to, etc. 

Could this be a factor? Might people be fighting to buy before they get notice of redundancy? Just a thought. 

On top of that there's Sunak's wall of cash... was discussing that with a self-employed family member who was puzzled... they get a wad of money way above what they would usually earn because the calculation is so odd (if you are self employed and your expenses are a fraction higher or earnings a fraction lower you get a wad of cash that has no bearing on how much your profit has decreased, courtesy of Sunak - as she pointed out - why not provide an emergency loan to those who need it then only provide the grant if the accounts suggest needed to save the business!)

Sunak really is a clown isn't he. Throwing cash back and forth without any real assessment of how much is needed, or whether the support is needed atall! 

Edited by gruffydd
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15 minutes ago, gruffydd said:

Have noticed an uptick in the property market right now... and a good proportion of my friends and colleagues are worried about redundancy.

If you're made redundant then surely there's quite a wait before you can qualify once more for a mortgage... depending on the length of interruption - the type of work you move in to, etc. 

Could this be a factor? Might people be fighting to buy before they get notice of redundancy? Just a thought. 

On top of that there's Sunak's wall of cash... was discussing that with a self-employed family member who was puzzled... they get a wad of money way above what they would usually earn because the calculation is so odd (if you are self employed and your expenses are a fraction higher or earnings a fraction lower you get a wad of cash that has no bearing on how much your profit has decreased, courtesy of Sunak - as she pointed out - why not provide an emergency loan to those who need it then only provide the grant if the accounts suggest needed to save the business!)

Sunak really is a clown isn't he. Throwing cash back and forth without any real assessment of how much is needed, or whether the support is needed atall! 

Dont forget bounce back loans. £50k deposit right there. 

Lots of reasons people are buying. Main one probably still is renting in this country is expensive and dire. 

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17 minutes ago, gruffydd said:

Have noticed an uptick in the property market right now... and a good proportion of my friends and colleagues are worried about redundancy.

If you're made redundant then surely there's quite a wait before you can qualify once more for a mortgage... depending on the length of interruption - the type of work you move in to, etc. 

Could this be a factor? Might people be fighting to buy before they get notice of redundancy? Just a thought. 

On top of that there's Sunak's wall of cash... was discussing that with a self-employed family member who was puzzled... they get a wad of money way above what they would usually earn because the calculation is so odd (if you are self employed and your expenses are a fraction higher or earnings a fraction lower you get a wad of cash that has no bearing on how much your profit has decreased, courtesy of Sunak - as she pointed out - why not provide an emergency loan to those who need it then only provide the grant if the accounts suggest needed to save the business!)

Sunak really is a clown isn't he. Throwing cash back and forth without any real assessment of how much is needed, or whether the support is needed atall! 

Debt is wealth.

Houses make money so why not logically spend money so the house can earn whilst you are not?

If you cannot pay dont worry government will not let it happen Rishi will come to your aid.

 



 

Edited by Fromage Frais
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7 minutes ago, shlomo said:

Me, i have been told off the record that i may lose my job in the next few months.

What should i do?

Sorry to hear that.

I expect a large proportion of firms will be shedding staff over the next few months - many have started already - but even if your job in the firm might be safe would the general redundancy position at your firm affect your ability to get a mortgage? When you apply you have to declare this.

Its clearly a big risk - but given these people would have to pay rent or a mortgage anyway they probably are hoping if they do lose their job there is mortgage forebearance and no reposessions and prices go up. Gives them time to find another job.

 

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32 minutes ago, spyguy said:

V stupid.

Sure, you need job to get a mortgage.

But getting mortgage, then getting made redundant then failing to pay the mortgage gets you repod and blacklisted.

Perhaps the sense is the risk is lower than being chucked out of rental accommodation... plus expectations of gov support schemes. 

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6 minutes ago, gruffydd said:

Perhaps the sense is the risk is lower than being chucked out of rental accommodation... plus expectations of gov support schemes. 

Once you have property it's seen as insurance. Not just against further rent rises and hpi. If you can't get another job at least you can rent the place out, even if you have to couch surf yourself. 

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4 minutes ago, Trampa501 said:

Once you have property it's seen as insurance. Not just against further rent rises and hpi. If you can't get another job at least you can rent the place out, even if you have to couch surf yourself. 

Except most mortgage T's and C's forbid renting out, as does most home insurance.

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42 minutes ago, spyguy said:

V stupid.

Sure, you need job to get a mortgage.

But getting mortgage, then getting made redundant then failing to pay the mortgage gets you repod and blacklisted.

It doesn't, at least not for a very long time.

If you have a house deposit saved up, you'd probably be in a better position in the case of redundancy if you had used that cash for a house purchase, as you could go interest only (try this when renting), and get state support in terms of the interest portion paid for (by a loan added to the end of your mortgage), and you'd also be eligible for benefits if you had below the wealth thresholds.

By the time you come to remortgage, hopefully the redundancy will be a memory only, and it shouldn't really affect your ability to get a new mortgage as you only need 3x months wages on a payslip.

If you just stop paying the mortgage because you don't want to pay it, you'd probably be repoed quickly, but if you are genuinely struggling there is help out there.

If you're renting, however... you'd end up spending your deposit money on living costs and rent until you had (afaik) 16k or less.

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14 minutes ago, dpg50000 said:

Except most mortgage T's and C's forbid renting out, as does most home insurance.

Realistically its not difficult to get permission to rent, it can change your interest rate depending on provider. 

Same with changing home insurance over to rented. Hardly difficult. 

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1 hour ago, MARTINX9 said:

Sorry to hear that.

I expect a large proportion of firms will be shedding staff over the next few months - many have started already - but even if your job in the firm might be safe would the general redundancy position at your firm affect your ability to get a mortgage? When you apply you have to declare this.

Its clearly a big risk - but given these people would have to pay rent or a mortgage anyway they probably are hoping if they do lose their job there is mortgage forebearance and no reposessions and prices go up. Gives them time to find another job.

 

Sorry it was a rhetorical question, I have more than £200k in savings but no house 

so my circumstances are unusual 

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12 minutes ago, shlomo said:

Sorry it was a rhetorical question, I have more than £200k in savings but no house 

so my circumstances are unusual 

Well good to hear that!

Yes - quite unusual to have such high savings except for those who have recently sold but not bought. 40 per cent of people have been estimated to have less than £100 in savings - which illustrates how crazy prices for shelter are!

https://www.bbc.co.uk/news/business-37504449

Do you find it arguably a lot harder mentally if you have £200k you have personally saved/earned to actually buy - than say it was £10,000 and you were needing a 4 times salary stretching mortgage. 

Of course in the theoretical scenario you had no income and lost your job would you just buy to preserve savings.  In many parts of England - not the most desirable areas I admit - you could buy a house for £100k.

 

Edited by MARTINX9
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34 minutes ago, MARTINX9 said:

Well good to hear that!

Yes - quite unusual to have such high savings except for those who have recently sold but not bought. 40 per cent of people have been estimated to have less than £100 in savings - which illustrates how crazy prices for shelter are!

https://www.bbc.co.uk/news/business-37504449

Do you find it arguably a lot harder mentally if you have £200k you have personally saved/earned to actually buy - than say it was £10,000 and you were needing a 4 times salary stretching mortgage. 

Of course in the theoretical scenario you had no income and lost your job would you just buy to preserve savings.  In many parts of England - not the most desirable areas I admit - you could buy a house for £100k.

 

It’s not necessarily 100% more like 70% but then I have not looked for another job yet so don’t know what the job situation is like, and if they find a vaccine we may go back to a near normal 

just so many variables 

I live with my parents so don’t pay rent anyway 

I would never buy in the North as a BTL I have heard so many horror stories, and BTL as a new business strategy is over.

Edited by shlomo
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2 hours ago, definitelynotanagent said:

It doesn't, at least not for a very long time.

If you have a house deposit saved up, you'd probably be in a better position in the case of redundancy if you had used that cash for a house purchase, as you could go interest only (try this when renting), and get state support in terms of the interest portion paid for (by a loan added to the end of your mortgage), and you'd also be eligible for benefits if you had below the wealth thresholds.

By the time you come to remortgage, hopefully the redundancy will be a memory only, and it shouldn't really affect your ability to get a new mortgage as you only need 3x months wages on a payslip.

If you just stop paying the mortgage because you don't want to pay it, you'd probably be repoed quickly, but if you are genuinely struggling there is help out there.

If you're renting, however... you'd end up spending your deposit money on living costs and rent until you had (afaik) 16k or less.

Banks will be reluctant  go IO so soon in the mortgage.

SMI is is charge now, something banks are very sniffy of.

Assuming the mortgage deal is for 2 years, the bank will look at the gap in repayments and reject the mortgage, forcing borrower onto SVR.

If you are facing a period of unemployment then it's best to be renting.

Theres little help if you have a mortgage.

 

 

 

 

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2 hours ago, Trampa501 said:

Once you have property it's seen as insurance. Not just against further rent rises and hpi. If you can't get another job at least you can rent the place out, even if you have to couch surf yourself. 

A mortgage is a liability.

 

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2 hours ago, gruffydd said:

Perhaps the sense is the risk is lower than being chucked out of rental accommodation... plus expectations of gov support schemes. 

A lot of rental wont accept DSS renters. Bank rules.

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3 minutes ago, PeanutButter said:

 

Yep. 

Has been blindly obvious this has been going on for months. 

The fact that the scheme has now hit 25billion says it all. Over 600k loans. No checks whatsoever on income or even basic fraud checks. Mental. 

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3 minutes ago, spyguy said:

I am well aware of the eligibility. 

I am also aware its purely self certified. If you put your company turnover was 200k for year ending 31st dec 2019, 50k will be in your account within a week. Even if it was a shell that has not traded. 

You do not have to provide any evidence whatsoever 

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10 minutes ago, captainb said:

I am well aware of the eligibility. 

I am also aware its purely self certified. If you put your company turnover was 200k for year ending 31st dec 2019, 50k will be in your account within a week. Even if it was a shell that has not traded. 

You do not have to provide any evidence whatsoever 

Let's not rehash the meaning of fraud. You've obviously never been on the receiving end of a HMRC audit. 

When TSHTF and these start to default they'll go after the low hanging fraudulent fruit. They've already started.

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