The check to see if a buyer could pay if the interest rose by 3% seems like a really fucking smart thing to do, remembering 2008.
There should be a document when you take a mortgage that gives you an example of payments with interests all the way up to 15%, that should make everyone aware of how ridiculous house prices are right now.
Edit “by 3% not to 3%”
“Have you been renting a house all this time?”
Yes
“You can easily afford a mortgage then. Here you go”.
But apparently other tests could make it harder. It seems to be the stress test asking if you could afford a 3% rise in rates is fairly sensible, so not sure why it is been taken away
Honestly, people just wanna complain about everything. For ages people were moaning that they couldn’t borrow enough and x y z was unrealistic and pointless.
Now they’re removing x y or z people are moaning about it. Irresponsible, it’s only to increase turnover and sales and stimulate the housing market further are comments I’ve read in here already.
Increased regulation and Conservative policy are a lot of the barriers to young people getting on the housing ladder. This is a change in the CORRECT area. It might not be perfect and enough, but this is where motion needs to be set in place. Absolutely baffled people are complaining.
Bubble bursting competition incoming.
I’d rather more financial help than less checks. Cheaper homes would be great too…
And the reason that they are removing this is what exactly?
I ask this because the only genuine reason to remove the mortgage affordability test, is if they know for certain interest rates will never rise to the level that the MAT comes into play. Surely this can be the ONLY proper explanation.
And as the BoE has full control over interest rate decisions, then it really is only them, and them alone, who will be responsible if interest rates now go on to reach or exceed the stress test level. And therefore I suggest it is THEY, not us, who should be compelled to pay for the financial implications, if this should happen.
All we seem to be doing is pumping up the property price bubble more and more. This is incredibly detrimental to the UK economy, and its inhabitants as a whole.
The loan to income regulations haven’t changed (85% of mortgages must adhere to these). It was exceedingly unlikely that you’d pass the loan to income requirement and not this affordability test so it doesn’t really make too much difference
Hmm, could this mean the BoE has finally grown the balls to raise interest rates properly and removing the affordability test is a way to try and stop the housing market from crashing.
Interest rates need to rise to strengthen the £ to help shield us from rises in international oil and gas prices.
Edit: typos
Another fucking stupid move. So we’ll end up with tons of people buying houses (from the small pool that there is) which they can’t afford. Putting pressure on those who actually CAN afford, to increase the amount they borrow, to the point they CAN’T afford it.
All this shit will do, is push up house prices, and lead to loads of people defaulting on their mortgages in a couple of years.
Fucking idiots.
What could possibly go wrong?
History is just a circle.
This is a good idea. I can’t see this going wrong in any way. It’s definitely not like we are repeating the steps for the 2008 crash again…
I’m not expert but if this means more people can borrow, demand will go up and then house prices will rise.
Tax the shit out of second homes, houses owned by non doms, overseas owners and homes not owned by natural persons (corporations, trusts etc). House prices fall since they’re no longer viewed as an investment. Everyone can afford mortgage payments.
There. Solved it for you.
Ah, I see they want a repeat of 2008. Probably wanting a recession to reduce the inflation.
Isn’t this basic neocon economic practice what led to the crash in the first place? Free up the banks, enable them to lend money to people they wouldn’t previously have touched with a barge pole, cover their own arses with repayment insurance and cut the rope bridge?
Edit; I’m not a professor of money & that but I’ve watched a lot of Adam Curtis.
Genuine question:
Anyone aware of any regulations still in place to try and avoid junk mortgage bubbles appearing?
20 comments
If anything they should be doing the opposite.
Sub prime here we come
The check to see if a buyer could pay if the interest rose by 3% seems like a really fucking smart thing to do, remembering 2008.
There should be a document when you take a mortgage that gives you an example of payments with interests all the way up to 15%, that should make everyone aware of how ridiculous house prices are right now.
Edit “by 3% not to 3%”
“Have you been renting a house all this time?”
Yes
“You can easily afford a mortgage then. Here you go”.
But apparently other tests could make it harder. It seems to be the stress test asking if you could afford a 3% rise in rates is fairly sensible, so not sure why it is been taken away
Honestly, people just wanna complain about everything. For ages people were moaning that they couldn’t borrow enough and x y z was unrealistic and pointless.
Now they’re removing x y or z people are moaning about it. Irresponsible, it’s only to increase turnover and sales and stimulate the housing market further are comments I’ve read in here already.
Increased regulation and Conservative policy are a lot of the barriers to young people getting on the housing ladder. This is a change in the CORRECT area. It might not be perfect and enough, but this is where motion needs to be set in place. Absolutely baffled people are complaining.
Bubble bursting competition incoming.
I’d rather more financial help than less checks. Cheaper homes would be great too…
And the reason that they are removing this is what exactly?
I ask this because the only genuine reason to remove the mortgage affordability test, is if they know for certain interest rates will never rise to the level that the MAT comes into play. Surely this can be the ONLY proper explanation.
And as the BoE has full control over interest rate decisions, then it really is only them, and them alone, who will be responsible if interest rates now go on to reach or exceed the stress test level. And therefore I suggest it is THEY, not us, who should be compelled to pay for the financial implications, if this should happen.
All we seem to be doing is pumping up the property price bubble more and more. This is incredibly detrimental to the UK economy, and its inhabitants as a whole.
The loan to income regulations haven’t changed (85% of mortgages must adhere to these). It was exceedingly unlikely that you’d pass the loan to income requirement and not this affordability test so it doesn’t really make too much difference
Hmm, could this mean the BoE has finally grown the balls to raise interest rates properly and removing the affordability test is a way to try and stop the housing market from crashing.
Interest rates need to rise to strengthen the £ to help shield us from rises in international oil and gas prices.
Edit: typos
Another fucking stupid move. So we’ll end up with tons of people buying houses (from the small pool that there is) which they can’t afford. Putting pressure on those who actually CAN afford, to increase the amount they borrow, to the point they CAN’T afford it.
All this shit will do, is push up house prices, and lead to loads of people defaulting on their mortgages in a couple of years.
Fucking idiots.
What could possibly go wrong?
History is just a circle.
This is a good idea. I can’t see this going wrong in any way. It’s definitely not like we are repeating the steps for the 2008 crash again…
I’m not expert but if this means more people can borrow, demand will go up and then house prices will rise.
Tax the shit out of second homes, houses owned by non doms, overseas owners and homes not owned by natural persons (corporations, trusts etc). House prices fall since they’re no longer viewed as an investment. Everyone can afford mortgage payments.
There. Solved it for you.
Ah, I see they want a repeat of 2008. Probably wanting a recession to reduce the inflation.
Isn’t this basic neocon economic practice what led to the crash in the first place? Free up the banks, enable them to lend money to people they wouldn’t previously have touched with a barge pole, cover their own arses with repayment insurance and cut the rope bridge?
Edit; I’m not a professor of money & that but I’ve watched a lot of Adam Curtis.
Genuine question:
Anyone aware of any regulations still in place to try and avoid junk mortgage bubbles appearing?