Sunday, October 29, 2006

Banks throwing money at FTBs

Lender offers over 7.5 times income to mortgage borrowers

Pretend you are a mortgage broker and plug your details into this calculator here. Depending on your income, and the interest rate available you can be offered anything up to 7.53 times income. Fantastic? Ludicrous? Criminal? You decide. The calculator is hosted by First National, part of GE Money. Fascinatingly, GE's blurb contains the following: "An interest-only mortgage must be backed by an adequate investment vehicle." Ah. So that means that out of the 30 per cent of their income that remains after paying the mortgage interest bill, this couple needs to find money sufficient to invest in a vehicle that will produce a lump sum to pay off their £376,506 mortgage capital debt. Good, prudent advice from GE Money. Question is, what would that leave them to eat?

Posted by little professor @ 10:27 PM (541 views)
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One thought on “Banks throwing money at FTBs

  • little professor says:

    The First National brand is part of General Electric Money, which was launched in the UK on 4th October 2005. The website the article is linking to is firstnatonline.co.uk, which is a tool from First National to help mortgage advisers determine what FirstNat products they can offer to their customers. For my income of 50,000 I managed to get an offer of 400,000 on an IO basis.

    Here’s the site in question:
    https://www.firstnatonline.co.uk/brandeddtir/optomacalc.aspx

    (It claims it only works in IE, but firefox with User Agent Switcher set to IE works fine)

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