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'i Needed 20k Deposit' - From Telegraph 08.03.08

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Check the arrogance of this guy. If he hadn't saved a penny why should the bank believe he can afford a £412,000 mortgage?!?

When Phillip McMahon found his ideal home in Balham, south London, he thought all he needed to do was haggle over the price.

Mr McMahon has a good salary as an information technology security adviser in the City, and he did not expect any difficulty in obtaining a 100pc mortgage.

The property was on sale for £420,000 and Mr McMahon was able to haggle the price down to £412,000 but he was less successful when it came to the mortgage, despite using the services of brokers John Charcol.

He explained: "They were very honest and straightforward with me but made it clear that I would just not qualify for a 100pc mortgage. The best they could offer was a 95pc deal from Accord."

That meant Mr McMahon had to find £20,600 as a deposit. He discovered that the deal he was offered – 6.39pc fixed for two years – cost more than he could have paid.

He would have benefited from being able to provide a bigger deposit.

"I was luckier than some people because my father was able to lend me a large slice of what I needed.

"In addition, I did have some money tucked away, though I had hoped to use it to pay for furnishings and the like. It will just take a bit longer to turn the house into a home," he said.

Mr McMahon's girlfriend, Harriet Turner, will be moving in with him soon and they are currently working out what they can – and cannot – afford to do.

Along the way, Mr McMahon has discovered some information about his credit record.

"When I was a student I had debt but have since cleared it and stayed clear of credit and loans."

As a result, some lenders were unsure about lending to me at all – apparently because there was nothing on my record to show I could handle repaying a loan.

"I even found one credit reference agency that did not show me as being on the electoral roll, even though I have voted in all the recent elections."

He has now sorted out all these problems.

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Mr McMahon has a good salary as an information technology security adviser in the City, and he did not expect any difficulty in obtaining a 100pc mortgage.

Consultancy jobs in the city, surely not the most secure job? Why are these people still getting 95% mortgages? I wonder what the multiple is?

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Consultancy jobs in the city, surely not the most secure job? Why are these people still getting 95% mortgages? I wonder what the multiple is?

Doesn't say how old he is either. To be honest I find these stories a bit surreal. As someone who's sensible with money I can't imagine how profligate you would need to be if your income can service a 400k mortgage but can't get your hands on 20k without taking out another loan.

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The property was on sale for £420,000 and Mr McMahon was able to haggle the price down to £412,000 but he was less successful when it came to the mortgage, despite using the services of brokers John Charcol.

He explained: "They were very honest and straightforward with me but made it clear that I would just not qualify for a 100pc mortgage. The best they could offer was a 95pc deal from Accord."

That meant Mr McMahon had to find £20,600 as a deposit. He discovered that the deal he was offered – 6.39pc fixed for two years – cost more than he could have paid.

Isn't it amazing that someone paying 400k for a property doesn't have a 20k deposit?

Aren't these people supposed to be earning big money in London?

What chance does this guy have of ever repaying the loan?

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Isn't it amazing that someone paying 400k for a property doesn't have a 20k deposit?

Aren't these people supposed to be earning big money in London?

What chance does this guy have of ever repaying the loan?

He'll be in default by this time in 2009.

100% guaranteed.

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Doesn't say how old he is either. To be honest I find these stories a bit surreal. As someone who's sensible with money I can't imagine how profligate you would need to be if your income can service a 400k mortgage but can't get your hands on 20k without taking out another loan.

He's 29 I just facebooked him

Employer: Deutsche-Bank Group

Position: VP, Enterprise Security Strategist

Time Period: June 2007 - Present

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I guess you don't need much up top to get a well paid job in "IT security"?

Not really, thats why they only pay 250k per annum in the banking sector for IT Security Specialists.

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Mr McMahon has a good salary as an information technology security adviser in the City, and he did not expect any difficulty in obtaining a 100pc mortgage.

The property was on sale for £420,000 and Mr McMahon was able to haggle the price down to £412,000 but he was less successful when it came to the mortgage, despite using the services of brokers John Charcol.

Job = totally unstable discipline (IT) in a totally unstable industry (the City). No wonder they're cagy about lending him 100%.

A quick check on rightmove suggests 2-bed properties round there start at c. £250K - he will shortly be co-habiting & 2 bedrooms is more than they need. Why must he have a £400K+ place? Ever heard of working up to it, mate?

Daddy steps in with the money = great if you have a rich daddy.

Why can't he lay his hands on £20K in a hurry if he can pull a £400K mortgage? As per a previous poster's point, what's the multiple?

Google his name. Only been in his current job since last June - does the City have 1-year probationary periods?

TBH, my heart pumps p!ss for this guy. It's basically "I earn a decent whack right now, but inexplicably I don't have any to hand to act as a deposit. I was staggered to find that mortgage brokers won't lend me 100%, forcing me (totally unfairly) to have to dip into the expensive furniture / Phillip Starck lemon-juicer / Bang & Olufsen budget. Luckily, Daddy was able to lend me some money."

F*ck him, frankly - over-privileged ponce. There are millions in far worse stead than he is, just trying to get a foothold in property ownership of any sort. But at least we won't be rocking with £150K negative equity in a year or two's time.

This is a total non-story, but it's the Torygraph. The story is basically saying 'the current credit-crunch & imminent HPC are affecting one of us now - panic!"

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He's 29 I just facebooked him

Employer: Deutsche-Bank Group

Position: VP, Enterprise Security Strategist

Time Period: June 2007 - Present

Now THAT! is what I call secure. A security 'consultant' with a public facebook profile.

Social network engineering or what.

Twot.

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Am i missing something here? Security for a bank, and still cant save £20k for a deposit? Not only that, but you'd think someone who worked in a field like IT would have a tiny bit of logic + friends that would point against buying in such uncertain times?!

Something surreal about this article.

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Not really, thats why they only pay 250k per annum in the banking sector for IT Security Specialists.

Jade Goody has earned millions for being a confounded moron, what's your point?

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This is a total non-story, but it's the Torygraph. The story is basically saying 'the current credit-crunch & imminent HPC are affecting one of us now - panic!"

I think its saying 'you might think it won't affect you - but you are wrong. Dead wrong. And this is why you're all ******ed. Thank ****** I read HPC and offloaded my portfolio last year.'

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Yikes that's scary. Maybe I should delete my Facebook account. :ph34r:

Just make it private.

A senior IT security expert with an open facebook profile. You could not make it up :lol:

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Now THAT! is what I call secure. A security 'consultant' with a public facebook profile.

Social network engineering or what.

Twot.

:lol: That's what I thought.

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Political Views: Apathetic :lol:

Lets keep an eye on his profile over the next couple of years and update it as the news comes in

status update "PhilipMcMahon is being reposessed today" :lol:

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Since when were you into BTL?

I think you missed the bit where I wrote 'I think its saying' :lol:

str jan last year... 60k in the bank. ;) Well... less the unsecured lending from student days... so around 40k... :)

Edited by RichB

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Here's what he can get for his money via a mortgage and via renting. The cost of an IO mortgage after the deposit is paid is £2084/month but could go to £3914 if interest rates hit 12%, warns the BBC mortgage calculator page. I don't know the area but the house styles are similar and the flat is on a quiet tree lined street, both are near the station.

Mortgage: 2 bed flat

http://www.rightmove.co.uk/viewdetails-170...=1&tr_t=buy

Rent: 3 bed flat

http://www.rightmove.co.uk/viewdetails-197...1&tr_t=rent

2145/month but the interest on the saved deposit will cover the difference

He's keeping his fingers crossed that the prices go up then!

Edit: forgot about stamp duty - another £12360 to find!

Edited by jimmy_joe

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The most shocking think about this is that a 2 bed flat in Balham costs 425K!

They are semi detached houses split into two FFS!

Christ, the world has gone mad! :o

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