[Finance] Mortgage question

Shropshire Seagull said:

Slightly off topic [but smugly can't help myself - sorry].
I made my first mortgage payment in 1988 and my last one will be on the 28th of THIS MONTH

#byebyemillstone ...

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Blue3 said:

It's a bridging loan that you would need to be put into place

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Shropshire Seagull said:

Slightly off topic [but smugly can't help myself - sorry].
I made my first mortgage payment in 1988 and my last one will be on the 28th of THIS MONTH

#byebyemillstone ...

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Farehamseagull said:

Spot on. As a fellow MA, you’ve just saved me typing out pretty much exactly the same.

To add to some of the comments about interest only mortgages, residential interest only mortgage are very hard to get these days. Rightly so, I speak to people so often who are now in a really difficult situation and basically have no option other than to sell up due to irresponsible lending in the 90’s and 00’s. If you are fortunate enough to meet the lenders criteria with regard to age, equity and minimum income though, you do still have to pass the same affordability checks as if you were taking out a repayment mortgage anyway.

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Super Steve Earle said:

Surely you mean irresponsible borrowers who didn't set up a repayment vehicle, not irresponsible lending?

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Uncle Spielberg said:

What people forget is those people managed to get on the property ladder by getting an interest only mortgage as it was cheaper. Now, by doing this they may have made tens of thousands of pounds in equity in periods of price growth that they would not have otherwise had if they had rented instead

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Super Steve Earle said:

Surely you mean irresponsible borrowers who didn't set up a repayment vehicle, not irresponsible lending?

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Uncle Spielberg said:

What people forget is those people managed to get on the property ladder by getting an interest only mortgage as it was cheaper. Now, by doing this they may have made tens of thousands of pounds in equity in periods of price growth that they would not have otherwise had if they had rented instead

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Farehamseagull said:

Yes for sure but unfortunately there was no way everyone doing it was going to be that sensible and also a lot of repayment vehicles were mis-sold or weren’t actually suitable for the individual or purpose. Like 125% LTV mortgages and self cert mortgages, they were a disaster waiting to happen.

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Weststander said:

Very true. The soft touch approach to regulation/supervision of the lending sector in the noughties, exacerbated the collapse and near collapse of lending institutions, and misery for some borrowers who were left with negative equity when they wanted to move home.

Lessons of history are never learnt. It was similar to lax, over-lending in the 80’s, which led to 338,000 families having their homes repossessed between 1990 and 1996.

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London Black Cab said:

I was working for a Lehman’s Owned Mortgage Lender in the earliest 2000’s and we had a product internally known as the right to lie product

Unlimited Adverse, Self Cert up to 40,000 income no questions based on the property market getting us the equity needed to continue the Charade of people remortgaging to actually live off the capital raised.

Spent a lot of time qualifying the influx of “IT Consultants” and “landscape Gardner’s “ and if memory serves we got extremely burnt in Thamesmead SE28 due to concentration risk. The Sales Team generally vetoed any of our investigations as they had the ear of the board.

Ahh, the good old days!


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Poojah said:

It’s a fair question, but I’ve been transparent. They shared their situation, and I said “ok, I THINK I might be able to work quickly, IF I can, would you accept X”. They said yes, I said I’ll get back to them.

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Weststander said:

Through my profession and personally, I knew people in modest homes upwards, who remortgaged to buy £40k Mercs or to go on a bunch of lovely holidays. Dreams fulfilled in taking the family to Florida or California or Barbados. The remortgage forms generally stated “home extension”. It was about 20 years ago that new, very decent cars became ten a penny, 21 year olds buying new Polo’s, Golf’s, Minis, Beetles and A3’s often thanks to the bank of Mum and Dad (no more rusty bangers as the first or second car). Every other house even on modest Bovis estates having a shiny new BMW 5 Series or Audi. Also aided by PCP car deals.

An explosion of consumer credit.

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London Black Cab said:

I think social media and reality tv adds to the pressure of keeping up


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Poojah said:

Well, it feels like a very long time since I first started this thread all the way back in mid-February, the day before Valentine's day. Anyway, somehow, and I'm not quite sure how, we got the job done and completed on our new home last Friday. It's been a stressful one, and it took some serious renegotiating in April to get the house down to an agreeable price given the uncertainty of the property market right now.

In particular, I'd also like to say thank you to NSC's very own [MENTION=3887]Uncle Spielberg[/MENTION], recommended to me early on in this thread. It would have been a very complicated situation anyway, but it was made all the worse by coronavirus and the subsequent lockdown. I'm not sure it would have been possible without the assistance of such an experienced and determined mortgage broker. If anyone's looking to buy a home anytime soon, I would 100% recommend enlisting his services.

Thank you!

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