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Credit deflation and the reflation cycle to come.


DurhamBorn

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Democorruptcy
2 hours ago, spygirl said:

The 'no mre than 15% of loan greater than 4.5x' is a sop to the idiot banks and their backers/lobbyists.

In reality., no bank that wants to stay in biusiess is letting people go over the 4.5 limit.

MMR includes a nubmer of other hurdles inc stress test @ mortgage payments 6% should not take more than 30% of household income.

Its hard to get figures o nthe how many mrotgages asre >4.5. Id gues very very few. And only in truley expcetional cases

 

The MMR doesn't even have a maximum length of mortgage term. Computer says 'no' just extend the term 5 years to bring the monthly payments down. Banks must be it in from the extra mortgage interest, particularly if DB is right about future rate rises.

Good luck with your personal guessing but back in the real world, July:

Quote

 

After the financial crash struck in 2008, loans to first-time buyers were immediately slashed. There would be no more jumbo-sized mortgages of five times income or more. There would be no more 95% or 100% loans. Buyers would need a large deposit. But this week Clydesdale Bank said it will grant first-time buyers mortgages of 5.5 times a borrower’s income and lend up to £600,000 – and the buyer only needs a 5% deposit.

....

At brokers John Charcol, Ray Boulger says: “Most lenders’ maximum income multiple is between 4 and 4.5. The reason the cap bunches at 4.5x is the Bank of England’s Financial Policy Committee cap on lending above 4.5x income, which stipulates that no more than 15% of new lending can be in excess of 4.5x income on a rolling 12-month basis.

“For borrowers without significant other financial commitments, affordability assessments often allow a maximum loan in excess of 4.5x and so despite the regulators sensibly moving lenders away from strict income multiples to an affordability basis, most lenders have retained income multiples as well, partly to comply with the FPC rule. Because many lenders are close to the 15% allowed above 4.5x income they have to decide which type of applicants to prioritise for their 15% allowance.”

https://www.theguardian.com/money/2018/jul/21/mortgage-clydesdale-bank-first-time-buyers

 

 

 

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Democorruptcy
4 hours ago, Lavalas said:

 

Don’t beat yourselves up guys. You did good due diligence on Tahoe and rightly swerved it for a while. That kind of rigour will save you more than you lose in unexpected takeovers.

I thought that. You don't go bust taking profits all the time, my mother used to tell me "you don't get anything for gonna, you should be thinking about the next winner".

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11 minutes ago, Democorruptcy said:

I thought that. You don't go bust taking profits all the time, my mother used to tell me "you don't get anything for gonna, you should be thinking about the next winner".

B*gger, should have sold Microfocus today!

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21 hours ago, Admiral Pepe said:

Anyone for some CRUD? I might start taking a bite around £6

image.thumb.png.7b8adedc13715db497ee2f937cbc50ee.png

Added to my trading watchlist.  GIve you the nod when it looks good to me.  Not far off.

Or be brave and go LOIL!

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8 hours ago, kibuc said:

Fuck me twice.

Pan American Silver to buy Tahoe

https://www.reuters.com/article/us-tahoe-resources-m-a-pan-amer-silver/pan-american-silver-to-buy-tahoe-resources-for-1-1-billion-idUSKCN1NJ0ZD

That's Tahoe off my soon-to-buy radar, then.

Edit: 55% premium, oh for fucks sake! They couldn't wait two more month, fucking could they?

 

7 hours ago, DurhamBorn said:

They were number 2 on my rubber band list and about a 25% profit from the day they were put on here.In the future that will likely look like a steal for Pan American.Now the question is how under valued are the other silver miners?.

I have couple of hundred pounds in them and I am still down by about the same amount they are up today.  $4.10 will just return cash I paid initially.  Happy either way!

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2 hours ago, Democorruptcy said:

The MMR doesn't even have a maximum length of mortgage term. Computer says 'no' just extend the term 5 years to bring the monthly payments down. Banks must be it in from the extra mortgage interest, particularly if DB is right about future rate rises.

Good luck with your personal guessing but back in the real world, July:

 

 

No but banks wont extend a loan past retirement.

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1 hour ago, MvR said:

Meanwhile, natural gas is exploding... +50% over the last few days.  Due to cold weather forecasts according to various articles.  That's quite a spike though..

gas_on_fire.thumb.jpg.290aa3acaab7d1eb55c8177479d6fdb4.jpg

Long oil/short ngas hedge fund blowing up, apparently.  If so, it'll calm back down soon enough.

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Democorruptcy
42 minutes ago, spygirl said:

No but banks wont extend a loan past retirement.

You aren't up to date on mortgage ageism then?

Quote


From July, Nationwide is going to raise its limit for mortgage lending to 80, with a maximum age at maturity of 85 for existing customers. That means customers will be able to take out a mortgage up to the age of 80.

Since the crisis, high-street lenders have steered clear of lending to those over the age of 75. The increases will provide older customers with more flexibility to move home or release equity, and can be viewed as a sign of confidence in the market.

Nationwide’s move comes just days after Halifax raised its maximum age at maturity to 80, following pressure against ageism in the mortgage sector.

https://www.telegraph.co.uk/personal-banking/mortgages/nationwide-offers-mortgages-up-to-age-85-but-does-anyone-go-high/

 

 

 

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4 minutes ago, Barnsey said:

Work colleague just got one with term to 70 years old.

My dads 72 and just paid his mortgage off.

MMR has done sweet FA, spy sadly doesnt seem to accept this ... like Democorruptcy says they just extend it until computer says yes.

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14 minutes ago, Banned said:

My dads 72 and just paid his mortgage off.

MMR has done sweet FA, spy sadly doesnt seem to accept this ... like Democorruptcy says they just extend it until computer says yes.

Extending beyond 30 years has luttle to no affect on making the mortgage cheaper.

Anyone with a spreatsheet will avoid a mortgage much beyond 20 years.

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14 minutes ago, spygirl said:

Extending beyond 30 years has luttle to no affect on making the mortgage cheaper.

Anyone with a spreatsheet will avoid a mortgage much beyond 20 years.

The problem most dont bother with spreadsheets. I know two couples that have 30 year mortgages as FTB'ers. Whats the monthly payment Mr Banker? Oh yes I can afford that over 30-35 years no problems

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37 minutes ago, Barnsey said:

Work colleague just got one with term to 70 years old.

That's when you know we still have a long way to go before this thing ever comes crumbling down. Soon as I get to NI i'm buying a house and sucking it up. Couldn't care if I take a 50% haircut. It will still be better than taking a 50% haircut in the SE. 10 year fix and just being done with it. This housing situation makes me sick!

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5 hours ago, Barnsey said:

Apple has just officially entered a bear market :ph34r:

It's seems as if the Fang stocks have broken south at last.All of them are rolling over or have done.The big bear looms.

17 minutes ago, Agent ZigZag said:

Big turn down over the last 3 weeks in  approved mortgage lending

 

 

What's your source on that one Zigzag?I've froma surveyor that Nwide have been writing a lot of the cruddy mortgages of late.It looks like the big banks ahve kept their distance a bit better this time.

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Nationwides work I think are panelled to countrywide and are a desperate lender. Countrywide are tick box merchants and do not really value accordingly but rather appease the lender.My source is from another a major panel lender.

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24 minutes ago, sancho panza said:

It's seems as if the Fang stocks have broken south at last.All of them are rolling over or have done.The big bear looms.

What's your source on that one Zigzag?I've froma surveyor that Nwide have been writing a lot of the cruddy mortgages of late.It looks like the big banks ahve kept their distance a bit better this time.

I want to say I recall reading (quite a while ago) NW were writing a big chunk of HTB's mortgages too and then aren't letting the customers remortgage. 

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53 minutes ago, Agent ZigZag said:

Big turn down over the last 3 weeks in  approved mortgage lending

 

 

This may be a seasonal thing but I have my doubts, or should I say the feed back i got was somewhat muted.

If there is a trend in place is this marrying up with the current oil price trend?

 

i read another comment on here regarding Metro Bank , that a big short position is held  against them. Their residential mortgage book I would view as generally OK ish. i know they lend alot with older clients and that their checks are not as thorough as other lenders. Does anybody have any further info on this lender.

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16 minutes ago, Agent ZigZag said:

i read another comment on here regarding Metro Bank , that a big short position is held  against them. Their residential mortgage book I would view as generally OK ish. i know they lend alot with older clients and that their checks are not as thorough as other lenders. Does anybody have any further info on this lender.

https://uk.reuters.com/article/uk-metro-bank-outlook/metro-bank-shares-slide-after-warning-on-mortgage-market-competition-idUKKCN1MY0KZ

“While compression (in NIM) had been expected, the pace of erosion here is substantial and is a function of the company’s substantive bias towards mortgage lending (84 percent of the loan book) as well as higher deposit costs,” Goodbody analyst John Cronin said.

“We have consistently expressed our firm view that Metro’s model is not conducive to the achievement of its RoE (Return On Equity) targets and that the market valuation does not reflect this dynamic.”

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9 hours ago, Admiral Pepe said:

That's when you know we still have a long way to go before this thing ever comes crumbling down. Soon as I get to NI i'm buying a house and sucking it up. Couldn't care if I take a 50% haircut. It will still be better than taking a 50% haircut in the SE. 10 year fix and just being done with it. This housing situation makes me sick!

If you can find something you can improve value on - identify the negatives, work out if some/all of those negatives can be fixed and what it would cost and see if the calcs work - an EA should be able to give valuation at the time of viewing. At least then even with falls you will be relatively better off.

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