Buy-to-let Investors Fear They May Be Left Homeless

[DinosaursAreAwesome]

The common thread is greed, from the buyer, to the mortgage broker, the solicitor, to the banker. All were driven by it and profited by it.

Greed is one of the 7 deadly sins. For good reason - greed is not good, it is self-destructive. Greed is not wanting to get rich, but wanting to get rich by providing nothing in return. Any plan to get-rich-quick is driven by greed and is ultimately doomed to failure. Those who were misled, were happy to be because they thought that they would get something for nothing. I have no sympathy with any of them.

I love your sig.

[dreamOn120k]

yes, I noticed that.

so included in the fraud as participants:

1. the developer, inflating the price with a gifted deposit

2. The surveyor, for gold plating item 1

3. the lawyer, for not checking and advising the marks

4. the borrowers ( The marks)

5. The broker filling out the forms and applying to the lender, (he would have done a few apps and known that rents werent up to the promises)

6. The Lending department of the financial institution for not checking basic facts of the applications.

7. The Financial Institution for not providing adequate supervision of its departments in order to keep make a profit and bonuses.

8. The Financial institution for being involved and complicit in the creation of SIV's, a vehicle DESIGNED to circumvent regulation for lending and reduce risk to very low levels (HA HA)

Excellent post but you missed the greatest fraudster in the pyramid, namely one Gordon Brown.

Three years ago I had a long conversation with a highly stressed employee of a High Street Bank, she specialized in selling mortgages. She admitted everyone involved knew about the "gifted deposit" situation. I asked why the government did not step in to legislate against the practice "what" you must be joking she said, "do you realize how much revenue HMG would loose in Stamp Duty".

[Bloo Loo]

Excellent post but you missed the greatest fraudster in the pyramid, namely one Gordon Brown.

Three years ago I had a long conversation with a highly stressed employee of a High Street Bank, she specialized in selling mortgages. She admitted everyone involved knew about the "gifted deposit" situation. I asked why the government did not step in to legislate against the practice "what" you must be joking she said, "do you realize how much revenue HMG would loose in Stamp Duty".

Not forgetting a Mr Tony Blair, and the long line of lunabour officials. ( I dont think the Tories would have been any different)

However, politicians have always behaved like this and they are held in low esteem as a result.

The price many professions are going to pay in the future for this mess is also a loss of esteem.

[IP Newcomer]

One of the things that a con man relies on is that his mark is less likely to complain because they will appear either greedy, stupid or both.

Does anyone think that this is what will happen with BTL investors once the climates turned against them and dinner party conversation turns merciless?

[Biffo the Bear]

"Miller, 52, a qualified solicitor who specialised in property work, lives in Bedford. He says: "I bought into this as everyone else was doing it, including the other directors. Even as a director of a firm selling flats, I could not see the game being played. And if I could not see it, then how could you expect the investors we attracted in with our marketing, to understand what was going on?"

We saw it, and so did many others, but woe betideth he who speaks against rampant HPI. The dinner party outcast, ignored in the office.. branded a doom-mongerer... ARISE AND CLAIM THY THRONE!

[@contradevian]

I'm wondering how those BTL Barons from Deptford (Pepys Estate) are getting on. The one's that featured prominently in the BBC's "The Tower," one enjoying a penthouse on the top floor.

It's time for a follow up BBC. We should be told!

Edited March 22, 2008 by rover2000

[Dr House]

Apologies for being BTL-ist, but the photos of these two guys EXACTLY represent my photofit of a BTL Landlord - grubby, seedy, dirty fingernails, frankly repulsive lowlife trying to feed off wht is basically a scam........ people's natures end up showing in their faces and appearances..................................

[IP Newcomer]

Solicitor Hammad Ahmed at Hull-based law firm Max Gold Partnership is co-ordinating class actions against developers, valuers, and lenders. For further details phone 01482 224900.

And we have a vested interest all of our very own.

He's got some form has our Hammad:

http://www.yorkshireeveningpost.co.uk/news...ttle.3787337.jp

It seems that Max Gold are no win no fee ambulance chasers.

[Little Professor]

In the Guardian article Geof Morris is in £200,000 negative equity, with £100,000 credit card debt and his own home in repossession proceedings.

Bet he wishes he hadn't written this:

http://www.zeromillion.com/financial-servi...off-morris.html

Geoff Morris is a self-made property millionaire who made it in less than 18 months even with a hectic day job. He has written a series of articles to help people like you achieve the same levels of success – as long as you are willing to 'Go For It!'

As soon as you have bought your first house, you should be thinking about buying your second and your third, and your fourth…..

If you go via one of the property clubs, the chances are that the developer would be willing to pay the 15% deposit as a 'gift'.

Whether you paid the deposit, or whether you got this 'gifted' deposit from the developers, this money, this equity in the property is YOURS. And not only that, it is a historical fact that house prices, given time, will always increase.

As this is a 'temporary' abode, why go for a mortgage that includes a repayment element in it? Why not go for what is known as an interest only mortgage?

If you bought 6 properties,each worth £200,000, and you got a 15% gifted deposit on each one, you are already looking at an equity of some £30,000 in each unit.If each property increased in value by just 5% per annum, that's £10,000 from every unit.

Just look what you would be gaining. You would now own a property portfolio of 6 investment properties worth £1.200,000 of which you would have instant equity of around £180,000, and this would be increasing (at just 5%) of some £60,000 every year. Without compounding this increase, if you sold all of your investment properties after 10 years, you would walk away with well over THREE QUARTERS OF A MILLION POUNDS!

[Mr Yogi]

One of the things that a con man relies on is that his mark is less likely to complain because they will appear either greedy, stupid or both.

Does anyone think that this is what will happen with BTL investors once the climates turned against them and dinner party conversation turns merciless?

The real con-men in this debacle have cleverly ensured that the 'marks' will not complain or sue by tying them into the fraud through their dodgy mortgage applications.

Once these two bozos stop and think this through they will shut up, quietly go bankrupt, and spend the rest of their miserable days on benefits or a state pension renting one of their godforsaken flats from a housing association.

Meanwhile, the winners presumably were the developers who built and sold this shite. I'd like to bet that they are also the ones who haven't actually broken any law! Gifting a deposit is not illegal.

[Bloo Loo]

The real con-men in this debacle have cleverly ensured that the 'marks' will not complain or sue by tying them into the fraud through their dodgy mortgage applications.

Once these two bozos stop and think this through they will shut up, quietly go bankrupt, and spend the rest of their miserable days on benefits or a state pension renting one of their godforsaken flats from a housing association.

Meanwhile, the winners presumably were the developers who built and sold this shite. I'd like to bet that they are also the ones who haven't actually broken any law! Gifting a deposit is not illegal.

No doubt the developers have bought and started on the next lot of flats.

There are no winners here except the fee taking "professionals". They walk. They should have there legs chopped.

[Not Long Now]

In the Guardian article Geof Morris is in £200,000 negative equity, with £100,000 credit card debt and his own home in repossession proceedings.

Bet he wishes he hadn't written this:

http://www.zeromillion.com/financial-servi...off-morris.html

Brilliant. Thanks for posting..

[contango]

Rather like the poor sods that they've priced out of the market.

Sounds so much nicer than "Burslem, Stoke-on-Trent", doesn't it?

I own a house in Burslem...quite funny reading this post, as just last week had a letter from the current tenant (single mother) who served her one month's notice. Reason? The area's now far too dangerous, property has been repeatedly vandalised and her neighbour was beaten by a youth with a steel bar....

[Not Long Now]

I own a house in Burslem...quite funny reading this post, as just last week had a letter from the current tenant (single mother) who served her one month's notice. Reason? The area's now far too dangerous, property has been repeatedly vandalised and her neighbour was beaten by a youth with a steel bar....

Sorry if you live in Burslem.....but it really is a truely awful place.

[contango]

Sorry if you live in Burslem.....but it really is a truely awful place.

No don't be ridiculous, I've only ever been there once, never again

[workingholiday]

The weekend Guardian has really been putting the boot in recently;

makes me look forward to Saturday...

[beans on toast]

UNfortunately for them they bought at the tail end. If they had bought 3 years earlier, they probably could have made their millions. Its all about timing.

[time 2 raise interest rates]

To expand.

BTL-the rent will be set by local supply, and demand of rental properties but how does a investor know what the rent he'll get ?

[/i]

Well i would have thought the best way for a BTL investor to work out how much rent he is likely to get is

to work out how much the people living in the local area are being paid it's the only way to get a true gauge

on possible rental income.

Most out of town pay is still around £15,000 a year so rents are limited also, higher rents = higher wage

inflation = higher interest rates, so they can't win.

[thecrashingisles]

No don't be ridiculous, I've only ever been there once, never again

So you were so horrified by the place you decided to buy a house there?

[contango]

So you were so horrified by the place you decided to buy a house there?

Well it wasn't for me, and at the time seemed like a good place to put money, as it's proved to be (was back in 2002). Also had a place in Hanley and some other interesting area which was equally horrific near the Britannia stadium....for some reason students and local love those terraced houses....

[Not Long Now]

Well it wasn't for me, and at the time seemed like a good place to put money, as it's proved to be (was back in 2002). Also had a place in Hanley and some other interesting area which was equally horrific near the Britannia stadium....for some reason students and local love those terraced houses....

Ive been to the Britannia and Vale Park a number of times.....never ceases to amaze me does Stoke. Whatever the weather in the outside world, there is always a big grey cloud hanging over the place.

Truely horrific place.

[Paddles]

There are going to be SO many of these stories in the press over the next 18 months.

The UK pension hole is about to get significantly deeper over the next ten years as a consequence. If these "innocents" had won with their gambles, they would be self-sufficient at retirement age but instead, they're going to be drawing the state pension and claiming housing benefit. I resent paying taxes for this.

[BandWagon]

In the Guardian article Geof Morris is in £200,000 negative equity, with £100,000 credit card debt and his own home in repossession proceedings.

Bet he wishes he hadn't written this:

http://www.zeromillion.com/financial-servi...off-morris.html

Just look what you would be gaining. You would now own a property portfolio of 6 investment properties worth £1.200,000 of which you would have instant equity of around £180,000, and this would be increasing (at just 5%) of some £60,000 every year. Without compounding this increase, if you sold all of your investment properties after 10 years, you would walk away with well over THREE QUARTERS OF A MILLION POUNDS!

And then you wake up and the coffee is cold...

[watch_out_below]

Bet he wishes he hadn't written this:

http://www.zeromillion.com/financial-servi...off-morris.html

his website is still live... http://horizonportfolios.com/propertyprofits4you/

"If you Want To Get Rich You've Got To Break The Law"

fool. absolutely zero sympathy!!

[watch_out_below]

edit: double post

Edited March 22, 2008 by watch_out_below