Mortgage lending end of self cert.

[Eric Mc]

Gary11 said:

Eric Mc said:

The housing market was way too hot anyway. It needed calming down.

Eric it certainly is cold right now and very calm.

Exactly. And it needs to stay that way whilst a sense of reality settles into place.

[turbobloke]

Eric Mc said:

Gary11 said:

Eric Mc said:

The housing market was way too hot anyway. It needed calming down.

Eric it certainly is cold right now and very calm.

Exactly. And it needs to stay that way whilst a sense of reality settles into place.

Markets don't do sense and reality, they only do fear, greed, ignorance, guesswork and interference (from politicians).

[Eric Mc]

turbobloke said:

Markets don't do sense and reality, they only do fear, greed, ignorance, guesswork and interference (from politicians).

Agreed, but in their rush from the extremes of over-exuberance to over cautiousness, they often pass through a "sensible" zone, for a few days at least.

[ringram]

House market is still overpriced because of this and other insane lending practices.
Soon the bubble will be deflated, I don't believe it has been yet. More regulations please

[Andrew[MG]]

Gary11 said:

Eric Mc said:

The housing market was way too hot anyway. It needed calming down.

Eric it certainly is cold right now and very calm.

Only for people trying to sell at overinflated prices?

Why would you need more then 3.5x your income as a mortgage?

[12gauge]

Gary11 said:

I dont advocate the previous policy resulting in toxicity was correct,I am saying this change is yet another downard pressure on the economy going into the new year.
Mortgage lending needs stimulus for ovious reasons not further retraction IMO.People (who obviously can afford to)not moving,not changing their car,not going on holiday is not good for the economy.I know several very wealthy people who are cutting right back even shopping at Aldi etc,not condemming them just vocalisng an observation.

Eh? Logic fail. Obviously if they require a loan, they cant afford to.

Endless access to cheap and easy credit isnt some sort of god given right.

[12gauge]

Anyway, will this actually have much or any effect on lending?

Self cert mortgages used to be commonplace, iirc as much as 20-30% of all mortgages between 2003-7, yet i havent seen any on the comparison sites for yonks. I figured most lenders stopped doing them a couple of years back.


How many have actually been fowarded over the last few years? I guess a fraction of those issued between c2003-2007.

My guess is theyre banning them because it makes a good headline and wont actually make any difference to lending.

[98elise]

Eric Mc said:

A return to sanity.

Self certification was a driver towards the lending madness that put us in the state we are in.

Good riddance, I say.

And there is no reason why the end of self certification should cause problems for those who run their own businesses. For decades, before the advent of self-certification, the self employed and those who ran their own limited companies were able to borrow - and that will still be the case.

Providing true and correct evidence of income should not ever be a problem.

Edited by Eric Mc on Monday 19th December 10:07

Nail on the head there, self cert is madness. I know someone with little provable income, yet managed to get over 1m+ in mortgages in the later half of the boom years. If it were not for cheap rates at the moment they would be in deep st.

We should never be in a position where a person can borrow 2 or 300k without any proof of income.

[Fats25]

Can I thread hijack for a moment?

I run a Ltd company, and I take a small salary and Dividends. Everything is 100% legit, and I have "books" since I began in 2008, showing my salary, and all Dividends (with certificates) taken.

If I were to apply for a mortgage would the total (Salary + Dividends) be taken into account, or just the salary?

[TTwiggy]

12gauge said:

Gary11 said:

I dont advocate the previous policy resulting in toxicity was correct,I am saying this change is yet another downard pressure on the economy going into the new year.
Mortgage lending needs stimulus for ovious reasons not further retraction IMO.People (who obviously can afford to)not moving,not changing their car,not going on holiday is not good for the economy.I know several very wealthy people who are cutting right back even shopping at Aldi etc,not condemming them just vocalisng an observation.

Eh? Logic fail. Obviously if they require a loan, they cant afford to.

Endless access to cheap and easy credit isnt some sort of god given right.

So, are you saying that you only buy houses for cash?

[scotal]

Fats25 said:

Can I thread hijack for a moment?

I run a Ltd company, and I take a small salary and Dividends. Everything is 100% legit, and I have "books" since I began in 2008, showing my salary, and all Dividends (with certificates) taken.

If I were to apply for a mortgage would the total (Salary + Dividends) be taken into account, or just the salary?

Salary and dividends.
How many years would be taken into account would be lender dependent.

[scotal]

12gauge said:

My guess is theyre banning them because it makes a good headline and wont actually make any difference to lending.

It'll stop them being reintroduced if nothing else.

[12gauge]

TTwiggy said:

So, are you saying that you only buy houses for cash?

Im saying that if they cant afford the deposit, or the rate, then they cant afford it. Period.

The market shouldnt simply be relaxed until anyone with any income or lack of, or any cash, or lack of, can enter it.

[Eric Mc]

Fats25 said:

Can I thread hijack for a moment?

I run a Ltd company, and I take a small salary and Dividends. Everything is 100% legit, and I have "books" since I began in 2008, showing my salary, and all Dividends (with certificates) taken.

If I were to apply for a mortgage would the total (Salary + Dividends) be taken into account, or just the salary?

An intelligent lender will look at the "big picture" i.e salary, dividends and the company profitability.

[Justayellowbadge]

Eric Mc said:

An intelligent lender will look at the "big picture" i.e salary, dividends and the company profitability.

So I'd imagine, for instance, you're buggered if it's a Solar Panel installation company, regardless of trading history.

[TTwiggy]

12gauge said:

TTwiggy said:

So, are you saying that you only buy houses for cash?

Im saying that if they cant afford the deposit, or the rate, then they cant afford it. Period.

The market shouldnt simply be relaxed until anyone with any income or lack of, or any cash, or lack of, can enter it.

But the post you responded to said 'people who can afford it' - which implies that they would have the required deposit/income.

You replied along the lines, that if they needed a loan, they couldn't afford 'it' - hence my question about buying houses outright for cash. If I have misunderstood you, then apoloogies.

[Eric Mc]

Justayellowbadge said:

Eric Mc said:

An intelligent lender will look at the "big picture" i.e salary, dividends and the company profitability.

So I'd imagine, for instance, you're buggered if it's a Solar Panel installation company, regardless of trading history.

Hopefully

[scotal]

Eric Mc said:

intelligent lender

Oxymoron.

[Countdown]

IME the main people this will affect is those who deliberately understated earnings for tax purposes but stated correct earnings for mortgage purposes. Even prudent lenders were happy to lend money when there was 30%-40% cash deposits being put down.

[Gary11]

12gauge said:

Eh? Logic fail. Obviously if they require a loan, they cant afford to.

Endless access to cheap and easy credit isnt some sort of god given right.

logic fail?
So if people need a loan then they cant afford to....what exactly?
I didnt say "cheap and easy credit was a god given right" please dont misquote me,however in reality there isnt just a top tier of people who dont need credit who are the only ones entitled to said credit,the banks are already shut to most and will only lend really to people who actually dont need credit, this lack of credit in all areas will affect the economy good bad or indeferrent nontheless a fact, if all credit was risk assed to the enth degree it would/is be bad for the UK buisness we wouldnt last long whatever the buisness no credit for the masses no buisness it is IMO a fact..wrong too I might add.
ETA
One can make a statement of fact without endorsing it as the authors belief.