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bazzzzzzz

Fsa Warns Banks Of Impact Of Debt On Families

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http://www.thisismoney.co.uk/credit-and-lo...9&in_page_id=62

SPIRALLING debt is pushing an ever-growing number of families to breaking point, the City's watchdog has warned.

There are signs of 'growing distress' among consumers as they struggle to cope with debt totalling £1.1trillion, said the Financial Services Authority.

In a thinly-veiled threat, it warned banks to be more careful about the amount of money that they lend - or risk getting themselves and their customers into serious trouble...

In an unusually frank statement, it said: 'We are seeing signs of growing distress among consumers, including more insolvencies, more late payments on credit cards and a rise in mortgage repossession orders...

The dramatic statement follows a cultural change as more and more people sign up to a 'spend-not-save' ethos. This is putting thousands of families and single people in a position where their debts are far bigger than their income or their savings.

Credit card companies have been attacked for encouraging customers to borrow when their debts are already out of control. 'Mega-mortgages', which allow families to borrow much more money to buy a home than in the past, are also causing widespread difficulty. Some have been able to borrow up to 125% of the property price.

In its annual Financial Risk Outlook report, the FSA warned banks and other lenders: 'Significant reputational damage could occur if they [regulated firms] are seen to have given credit to large numbers of individuals who are unable to afford debt repayments...'

Edited by Baz63

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Why would the banks give a damn?????? Reputational damage? Hasn't stopped them investing in the weapons industry, etc., etc. I suppose the FSA may be looking for self-regulation but they must be living in cloud cuckoo land if they think that there'll be any meaningful response to their 'veiled threat'. Isn't the FSA toothless anyway? Perhaps this is just a PR exercise - the FSA know that they'll achive nothing, but have to be seen to be doing something? Or am I just being too cynical?

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Why would the banks give a damn?????? Reputational damage? Hasn't stopped them investing in the weapons industry, etc., etc. I suppose the FSA may be looking for self-regulation but they must be living in cloud cuckoo land if they think that there'll be any meaningful response to their 'veiled threat'. Isn't the FSA toothless anyway? Perhaps this is just a PR exercise - the FSA know that they'll achive nothing, but have to be seen to be doing something? Or am I just being too cynical?

My thoughts exactly. You're not being too cynical at all.

What exactly are they doing to audit reckless IO mortgaging? and what actions are they taking to stop fraudulent self cert mortgages?

The rules (or the policing of the rules) have been too lax for too long.

And now the FSA are worried that someone might point the finger at them. How pathetic.

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And now the FSA are worried that someone might point the finger at them. How pathetic.

Yes, exactly my thoughts. Thus is just politics. If the FSA are so worried, why don't they take action?

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Yes, exactly my thoughts. Thus is just politics. If the FSA are so worried, why don't they take action?

Too little and *far* too late. They are simply covering their backs in preparation for the inevitable day when people say "why didn't you regulate all the property ramping?".

frugalista

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  • 301 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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