First Direct withdraws mortgages!!!!!!

  barca1 23:56 01 Apr 2008

Just to add (Sorry) this:

click here

  robgf 01:58 02 Apr 2008

They have only withdrawn mortgages to customers who are not already with them.

Seems very sensible to me. If the banks and building societies had stuck with the old system, of insisting that you save with them first for a few years and then meet the bank manager, to discuss what you could sensibly afford, they wouldn't be in the sticky situation that they now find themselves.

  interzone55 09:10 02 Apr 2008

Also interesting to note the FD actually only lend money deposited by savers, they don't borrow on the money markets.

So glad I bank with someone sensible rather than banks that overstretch themselves & get Golden Brown to bail them out at Tax Payers expense...

  donki 12:23 02 Apr 2008

Very well said, also if they had stuck with that system house prices wouldnt have ballooned to the exstent they have now. The pin is poised and it will burst very soon.

  spuds 12:53 02 Apr 2008

Another very interesting program was on BBC 2 television last night 'Super Rich- The Greed Game'. Some people are making very serious money on the back of others, especially the less well off.

A month or so ago, a similar program was shown on television, and seemed to suggest that there are huge deficits in some banking circles, and Northern Rock is definitely not the only finance provider in trouble.This is a world wide problem, and the writing as been on the wall for ages.

Yet big bonuses and huge golden handshakes are still an every day occurrence, for poor performers.

Will the bubble truly burst. According to some views, it may not burst, but it is going to get extremely uncomfortable for some people, especially the least well off, and the tax payers, who do not have the support of higher authorities.

  georgemac © 12:58 02 Apr 2008

Watching C4 news at lunch time a "financial expert" was on, and he was saying historically house prices have been historically 2.5 x wages (average). In the last few years this has risen to 3.4 x average wage, and houses are now no longer affordable in the UK, especially given the tightening of the belts by lenders.

He says the only saving grace for house prices in the UK, and this will stop a crash, is that demand is still greater than supply, as there is still a shortage of houses in the UK.

His firm predicts 5% reduction in house prices this year and next.

  Al94 12:58 02 Apr 2008

Interesting article, watch out for the Icelandic Banks click here

  lofty29 13:22 02 Apr 2008

What I find strange is that none of this was forseen, the long period of easy low cost credit had to come to a stop at some stage, as happened in the past, I remember when mortagage rates were 18%. when 90% mortagages were a rarety. Both institutions and people realy lived in a unreal world, and the lack of control which allowed this situation to develop has been appalling

  techie4me 13:25 02 Apr 2008

Seems a few more banks are going to follow.
No one wants to end up like Northern Rock!!

  spuds 13:29 02 Apr 2008

Regarding property prices, and the need to build more houses. I find it very depressing when some areas of the country were prime targets middle or working class, and those areas are no longer affordable or habitable.

Streets upon streets in cities have been left in dereliction due to repossessions or vandalism. I recall years ago, when the Welsh mining communities were severely hit with unemployment. Visiting some of those areas at the time was a very depressing situation, some areas over the border were in similar decline.

On the other end of the scale, we have the holiday home or week-enders. I knew a farmer in the Peak District who owned a substantial amount of farm property. When he died, the huge 'pay any amount' chequebooks soon surfaced. This practise was (and still is, on a slower scale) not only in the Peak District, but many other selectable areas as well. This in itself, was a turning point that prevented local born and bred people, from purchasing affordable properties in their own villages. Any new building if now allowed, is usually of 'executive' class with prices to match.

  wiz-king 13:47 02 Apr 2008

I seem to recall when I first got a mortgage that 2.5 times you salary was the norm and most banks and building societies gave preference to those who had been saving with them. Also most mortgage agreement were for at least 10 years - not chopping and changing every couple of years.

So it looks like a return to the 'old' ways.

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