way to buy.

[alfred]

Having recently read of potential property owners trying to get on the property ladder  the latest move has been suggested that people on benefits wont have to make a deposit,

its suggested that people will have to have a mortgage interest only,
so that no deposit will be required by the bank,   simply  that when the person sells the property then the deposit will be taken from the sale of the property 

its a different approach but will it work, ????

Q; have you any thoughts on the latest trend of buying a property without a deposit ,

[Cassandra]

Having recently read of potential property owners trying to get on the property ladder  the latest move has been suggested that people on benefits wont have to make a deposit,

its suggested that people will have to have a mortgage interest only,
so that no deposit will be required by the bank,   simply  that when the person sells the property then the deposit will be taken from the sale of the property

its a different approach but will it work, ????

Q; have you any thoughts on the latest trend of buying a property without a deposit ,

No, but if we stopped immigration the UK wouldn't have to build a city the size of Newcastle yearly to support a demand it wouldn't have? Supply side economics?

[Scrumpy]

First time buyers certainly need help to get on the ladder..

I don't understand why a (deposit) would be payed after the sale of a property.. Does it mean that the bank grab the ( deposit)..  Surely a deposit is taken OFF what is owing.. !!... 

[klondike]

I'm guessing that there is a notional deposit which reduces the mortgage and so the payments. I doubt that the bank's largess stretches to making that interest free of course. They seem to be  assuming we won't see negative equity again too which is by no means certain given the state of the economy. Perhaps they need all the immigrants to keep pushing house prices ever higher.

As interest only mortgages are never repaid it just boils down to renting from the banks who take any capital gains while the "buyer" shells out to maintain and improve the bank's investment. Unless they are going to run an investmet policy which the buyer pays into alongside the mortgage. This all sounds very like the veil of tears we saw in the 90s(?) with people out on the streets having lost everything.

[Alex]

Sounds like the Endowment mortgage I had years ago, that was interest only and fell short of what I owed !

[Jacqueline]

My daughter was told to get an Endowment Mortgage which like Alex's fell short of what she owed.  She re-mortgaged some years later to a  normal mortgage so is now on track.   I guess these new type mortgages with no deposit will really pile on the extra interest, the only winners are the banks and building societies. 

[klondike]

I had an endowment mortgage for a while but moved house and remortgaged with a standard one before I got to the point of finding the policy didn't cover the debt. I doubtless got royally shafted too though but that was lost in house price increases 
.

[Michael Rolls]

when Susan, my first wife, and I bought our house in Surbiton, the lender insisted that I, as the principal earner, took out a life insurance policy to cover the repayments if I snuffed it. It was for £4,500. Current asking price for that house? £750,000+. Crazy
Mike

[1955vintage]

When endowment mortgages were in their prime, I played cricket with a guy who sold them. Always bragging about his new Porsche and holidays in far away places, I realise something was not right and avoided them.

[Cassandra]

Sounds like the Endowment mortgage I had years ago, that was interest only and fell short of what I owed !

I don't think it matters Alex as it's only another Boris 'Wizard wheeze' in other words like everything else (except nett-zero) it won't ever happen, pure distraction!

[GrannyMac]

I see so many reports of benefit claimants in poverty, surely the responsibility of a mortgage (which doesn't attract the same help as rent) will tip people even further into debt. More social (not necessarily council) housing is needed, for low paid, working households.  Five year extendable tenancies, to enable saving for a mortgage, and no Right to Buy.

Also, if more older homeowners (who wish to) could downsize into affordable, suitable rented accommodation, they'd be able to help younger family members with deposits.

[Raven]

Don't know about where you are but that doesn't work here. When the stupid bedroom tax came in a few years ago, lots of people wanted to downsize but there were no one bedroom homes for them to move into.

[Jacqueline]

I was watching a TV programme a while back on just that subject, people were being charged the bedroom tax and trying to move down, but loads of people were competing for one flat with one bedroom.  How crazy and unfair to put this tax on people when they are unable to find a smaller home.

[Raven]

There are older people whose families have grown up and left home. Parents in 3 bed family homes with well tended gardens ect ect. They did try exchange lists but all they got is young families with children needing bigger houses but wanting to exchange 2 bed flats in noisy and busy areas. People of our age don't want to step backwards into noisy flats with lots of stairs. Lots of smaller single story homes with 1 or 2 bedrooms need to be built...... Pronto. Then older couples can downsize and their bigger houses can go to younger couples who need them.
This was a stupid idea that could never work without new housing.

[GrannyMac]

Don't know about where you are but that doesn't work here. When the stupid bedroom tax came in a few years ago, lots of people wanted to downsize but there were no one bedroom homes for them to move into.

Exactly. That's why I believe building more older people's social housing, one or two bedrooms, would make more family sized homes available. Living in appropriate housing also reduces bed blocking in hospitals.

June 28, 2022, 11:23:03 PM

I was watching a TV programme a while back on just that subject, people were being charged the bedroom tax and trying to move down, but loads of people were competing for one flat with one bedroom.  How crazy and unfair to put this tax on people when they are unable to find a smaller home.

I agree. But I also thought it unfair that previously a single person in council housing got their full rent paid regardless of house size, whereas a single person reliant on private renting would be lucky if their housing benefit covered the cost of a bedsit!