Tuesday, November 25, 2008

Struggling homeowners get more money; struggling tenants don’t

Government helps struggling homeowners

Homeowners facing repossession or struggling to meet mortgage payments after losing their jobs will receive extra support from the government following Monday’s pre-Budget report. The government focused its attention on helping existing borrowers in danger of losing their homes rather than first-time buyers who are having difficulty entering the property market. From April, the government has agreed to cover the monthly interest due on mortgages of up to £200,000 for eligible borrowers who have been out of work for at least 13 weeks and are having difficulty meeting their payments. Previously it only offered support to homeowners with mortgages of £100,000 or less.

Posted by drewster @ 01:18 AM (1337 views)
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19 thoughts on “Struggling homeowners get more money; struggling tenants don’t

  • People that buy things that they can’t afford get to keep them.

    People that don’t fulfil productive roles get paid money.

    What exactly is the effin point in working hard and saving these days?

    Reply
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  • 1. jackas – “What exactly is the effin point in working hard and saving these days?”

    So you have a choice! A choice whether the UK is the best place for you to exercise your trade.

    Look around – the weather is crap, tax is astronomical, emergency health care only, civil liberties eroded.

    If you are a productive member of society then you have a choice, the rest of the country gets told how much of their incomes they can keep.

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  • Is a 2.5% cut in VAT going to change a thing.

    e.g. Our old favourite a plasma TV – old price 500 squid – new price 489.36.

    Now for 1 which retailer is going to price the TV like that and 2 would 11 squid change the decision I make.

    In reality the TV will be re-priced at 495 (sheeple can’t work out percentages anyway), the people who would have bought it still will and the retailer will pocket most of the Tax cut. Same as the banking bailout – what you think this tax cut was designed for you!

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  • “Our old favourite a plasma TV – old price 500 squid – new price 489.36.” – which is more than likely discounted from £900 anyway, so you are correct 2.5% isn’t going to change anything on that front.

    I think I’m going to buy an Aston Martin, live in it and default on the payments. Do you think I could rustle up enough honest hardworking tax payers to cover the repayments?

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  • “From April, the government has agreed to cover the monthly interest due on mortgages of up to £200,000 for eligible borrowers who have been out of work for at least 13 weeks and are having difficulty meeting their payments.”

    Scenario; your employment contract comes to an end, you then stop paying your mortgage for 3 months (the no start to repossession period) then on the 13 week the government will start paying the interest @ 6 percent on a loan of up to 200K. This will completely change the direction of the housing market!

    There could be a lot of sitting at home on private housing estates; the people that don’t work on council estates do so because they get housing benefit paid. This could turnout to be a scammers dream.

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  • it_is_going_with_a_bang says:

    VAT
    All I can see happening is prices staying the same for the end user and the company selling the goods pocketing the extra 2.5%.
    I heard someone on the news saying it was hoped this would urge people to go out and spend money.
    When is the last time you walked down the high street and saw a sign saying 2.5% off? and then felt compelled to buy?
    It simply doesn’t happen for 99% of people!
    For companies who basically will keep charging prices to the punter at 17.5% rates the combined saving of everyones 2.5% which they now will no doubt pocket will however help the companies. That is where this tax cut is really aimed at. Not the man on the street at all.

    As far as mortgage interest payments are concerned after 3 months of non payment you are stuffed anyway. Not to mention the minefield of cr4p you get trying to get any benefit these days. The chances of it making any real difference to most people and their situation is practically nill. There will no doubt be a few people that make a living out of benefits but they have always found a way ….

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  • Anyone know what they mean when they say ‘eligible borrowers’?

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  • Will the last man out please shut the door.

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  • @ isitgoing – you have nailed it. Of course prices won’t change – they are set by the market. But the reduction will be of great help to VAT registered businesses – remembering always that the non-bank, non-construction, non-North Sea oil part of UK plc pays four times as much VAT as it does in corporation tax.

    @ Drewster, exactly. Home-owners are the anointed, can-do-no-wrong saviours of mankind to be feted by political parties on left and right. Sod the tenants.

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  • Judging from what we have seen during the last 12 months and knowing this is just the begining, can anyone in his right mind possibly think about such long term financial commitment as buying house? At this stage of the rise and fall of housing bubble, any effort to rig the market will end up miserable failure, I promise. 60% in general, 80% in London is the sheer inevitability.

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  • whostolemyendowment says:

    HOMEOWNERS………for pete’s sake they are ‘feckin’ DEBTOWNERS……they owe ‘money’ which through circumstance or fecklessness they can’t pay back….why should they be bailed out?

    I rent, I pay my rent, if I don’t I’m out on my ear……..nuff said!

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  • 8. whostolemyendowment – Yep but in this class system your bottom of the pile – upper class > homeowner class > non-working class > rent-boy class

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  • whostolemyendowment says:

    Cheers MTH……yep, I know I’m somewhere down the bottom as it’s raining sh1t on me all the time. My other concern is that BTL-ers will receive the same treatment – and while not paying their mortgages – I bet they will still collect their rents when due……

    an old favourite: John Cleese, Ronnie Barker and Ronnie Corbett: Class. http://uk.youtube.com/watch?v=w0DUsGSMwZY

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  • 10. whostolemyendowment – If its any concelation your not on your own :-#

    BTL – have already been bailed out – in the commercial sector that is – read pre-budget breakdown

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  • BTL won’t get bailed out because they are investors. The gov keeps doing investors in, look at shareholders of Northern Rock for example.

    This is Crash’s last throw of the dice but at the end of the day he will be voted out at the next election. Mortgage owners in trouble will lose their homes with or without bailouts you can’t hold up a collapsing house of cards with bailouts. I am a renter and lovin it, no debts no worries. Boiler broke down this morning, no worries called in the landlord to fix it.

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  • 3. mth, 5. itisgoing: as p4ac mentioned yesterday, I think the main reason for the VAT reduction is to lower the inflation figure, but it’s dressed up for the public.

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  • 12. mountain goat – so why did the government give tax relief on empty commercial property – i.e. tax relief for commercial BTL landlords

    We’ve got to start reading the small print

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  • Matt – I seem to remember there was a problem with commercial property being demolished because of a tax issue. In a recession business’ will close so commercial property will stand empty. If it is taxed and then gets demolished by the owner to avoid the tax the country loses commercial infrastructure.

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  • landofconfusion says:

    Also I didn’t realise that a house was a commercial property. I thought it was domestic…

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