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matt173407

So What Does All This Mean

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so with northern Rock going tits up do you think this is an indication that the HPC is kicking off, also do you think they will be selling there premises cheap could make some nice flats out of those ?

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Can I actually ask "What does all this mean"

Northern Rock isn't going bust. They just can't chuck money out at the crazy multiples that they used to. Correct?

So it should follow that the majority of the other big multiple lenders won't be able to get their loans from other banks like Northern Rock used to, and lend crazy multiples too. Correct?

So if someone took at a high multiple mortage at a fixed rate for two years (At the lower interest rates), what happens now when that rate expires and they revert to a massively higher S.V.R (Even higher now I'm sure) ?

Because it was a high multiple, would any providers now give them a new deal at all? - Have the rules changed that much now?

So if they can't switch to a better deal, are they comdemned to sit on the S.V.R and financially bleed to death?

Because if thats the case its gonna be absolute carnage and I'll feel very smug indeed that I have held off and not got caught up in all the "Buy, buy, buy" propaganda.

Is this actually a viable scenario?

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Can I actually ask "What does all this mean"

Northern Rock isn't going bust. They just can't chuck money out at the crazy multiples that they used to. Correct?

So it should follow that the majority of the other big multiple lenders won't be able to get their loans from other banks like Northern Rock used to, and lend crazy multiples too. Correct?

So if someone took at a high multiple mortage at a fixed rate for two years (At the lower interest rates), what happens now when that rate expires and they revert to a massively higher S.V.R (Even higher now I'm sure) ?

Because it was a high multiple, would any providers now give them a new deal at all? - Have the rules changed that much now?

So if they can't switch to a better deal, are they comdemned to sit on the S.V.R and financially bleed to death?

Because if thats the case its gonna be absolute carnage and I'll feel very smug indeed that I have held off and not got caught up in all the "Buy, buy, buy" propaganda.

Is this actually a viable scenario?

Yep

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Can I actually ask "What does all this mean"

Northern Rock isn't going bust. They just can't chuck money out at the crazy multiples that they used to. Correct?

So it should follow that the majority of the other big multiple lenders won't be able to get their loans from other banks like Northern Rock used to, and lend crazy multiples too. Correct?

So if someone took at a high multiple mortage at a fixed rate for two years (At the lower interest rates), what happens now when that rate expires and they revert to a massively higher S.V.R (Even higher now I'm sure) ?

Because it was a high multiple, would any providers now give them a new deal at all? - Have the rules changed that much now?

So if they can't switch to a better deal, are they comdemned to sit on the S.V.R and financially bleed to death?

Because if thats the case its gonna be absolute carnage and I'll feel very smug indeed that I have held off and not got caught up in all the "Buy, buy, buy" propaganda.

Is this actually a viable scenario?

Hmmm, if no-one trusts norther rock and everyone takes there BOE funded money out the bank ceases to exist (bank run)

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The key point that will come out of this saga is that the days of cheap credit are over. The days of credit to the financially unfit are also over. Therefore the house price boom is over. Therefore prices will begin their relentless decline to the longterm mean.

My thoughts exactly.

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how do you think this'll effect the BOE IR? Will they lower to try and counter this wobble do you think?

Maybe they will, maybe they won't. But what's really interesting (and new) is that the high street mortgage rate is becoming unhooked from the base rate, so no matter what the BOE do or don't do, the person in the street is facing higher mortgage rates and much, much tougher loan criteria.

No more 130% mortgages, maybe no more 100% mortgages, no more 6x or 5x income, maybe nor more 4x income, no more automatically including bonuses and commisions into salaries, no more lending to people with county court judgements, no more aggregating incomes from all household members at high multiples, no more taking your word on incomes, no more loans after just 12 months employment, no more second mortgages, no more BTL loans against dodgy valuations, no more BTL loans without high yields, no more BTL loans without sizeable deposits.

In fact...NO MORE JUST WALKING INTO A BANK AND WALKING OUT WITH A HUGE WODGE TO STOKE UP HPI.

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Maybe they will, maybe they won't. But what's really interesting (and new) is that the high street mortgage rate is becoming unhooked from the base rate, so no matter what the BOE do or don't do, the person in the street is facing higher mortgage rates and much, much tougher loan criteria.

No more 130% mortgages, maybe no more 100% mortgages, no more 6x or 5x income, maybe nor more 4x income, no more automatically including bonuses and commisions into salaries, no more lending to people with county court judgements, no more aggregating incomes from all household members at high multiples, no more taking your word on incomes, no more loans after just 12 months employment, no more second mortgages, no more BTL loans against dodgy valuations, no more BTL loans without high yields, no more BTL loans without sizeable deposits.

In fact...NO MORE JUST WALKING INTO A BANK AND WALKING OUT WITH A HUGE WODGE TO STOKE UP HPI.

So hopefully some sense in the market?

If people are prevented from MEW for deposits (their own for BTL or for their kids) and sensible lending multiples are applied then there is only one way houseprices can go!? But the lack of MEW etc is going to have a serious detrimental effect on the economy (miracle or not).

It is going to end in tears isnt it?

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It means the people who host the Rightmove website need to put a couple of extra database servers in the rack.

The phones at estate agents, especially the ones who deal largely with newbuild/prime BTL areas will be getting much busier although they should cope OK because nobody will be walking through the doors.

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So hopefully some sense in the market?

If people are prevented from MEW for deposits (their own for BTL or for their kids) and sensible lending multiples are applied then there is only one way houseprices can go!? But the lack of MEW etc is going to have a serious detrimental effect on the economy (miracle or not).

It is going to end in tears isnt it?

For most, yes it is.

But for sensible people with low or no debts it won't be too bad, especially if they keep their job. And for those rare few who resisted the siren calls of Argos and actually saved a bob or two, it could all turn out rather well.

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