What Credit Crunch - or have I missed the point?

  DANZIG 06:53 21 Nov 2008
Locked

Headline on the news - 'More people set to lose their homes as the economy worsens'.

I don't understand. We've just had our mortgage statement through and once again, our payments have dropped by £9 a month (not earth shattering I know), we have just had a pay rise and the cost of petrol is now at 90.9 in my local Sainsbury's.

Checking the bill at said supermarket when we went yesterday showed no noticeable increase either.

Admittedly our leccy and gas have gone up a bit, but apart from that, why ARE people losing their homes?

Have I missed the point??

  Forum Editor 07:06 21 Nov 2008

they've been made redundant, and can't keep up the mortgage payments?

  dagbladet 07:23 21 Nov 2008

Story on the local radio this morning. Local firm which employs 35 people shuts down. This company makes some kind of grommits which are used in the hydraulic lines of heavy plant machinery. Their main customer was JCB. JCB have recently slashed there workforce in responce to a huge reduction in orders for their diggers. Digger sales are down because the building industry is receiving less work as people are not in a good financial position to have their extension built. People are not in a good financial position to have their extension built because they have just been layed off from their work at a small local firm which made grommits which are used .............

  AL47 07:29 21 Nov 2008

im not really feeling it either, tho i dont own a home

but im not spending money eiher, im saving up with my not so well paying job cause i [personally] agree with the conservatives new approach, i dont want more government borrowing with a big tax bill later.

plus the more sales that come, the more people will wait for the best sale, its like the stock market in the high street

and for me, after rent, petrol and food are big expenditures, so this deflation, atm, is great for me

  Quickbeam 08:32 21 Nov 2008

Ask anyone that's involved in selling goods or services to the public, and they'll say they're not parting with their cash.

The public know hard times are coming and they're very much not prepared to pay for Christmas on plastic this year which would leave them struggling to repay for consumed goods and broken toys into next July.

  carver 08:34 21 Nov 2008

I know of a local construction firm that employs about 8 gangs of industrial roofers, the owner has just told 6 of his gangs that after the current job is finished there is no more work until well into mid January.

It doesn't take a genius to work out these people may now have no money until the next job starts in 8 weeks time.

The units which were to be built have now been put on hold, therefore the brickies, groundsmen and various other people will also not have any work, the firm which was to provide the roofing sheets now does not have an order for these sheets, the firm supplying the bricks has also had it's order stopped.

It's a snowball effect, and it's happening all over the country.

AL47, don't feel smug that it hasn't effected you yet, wait until the next time you go down the high street and notice that the store you liked so much has had to shut and that local butcher who sold such nice meat, well he's shut as well.

  newman35 08:59 21 Nov 2008

Cannot believe you are not able to appreciate the hard times (for other people!).
We all have our own little 'bubble' of life, but surely even you cannot have missed all the redundancies announced already?
Now, previously our banks had been allowing people to buy houses and giving them 125% loans - so if they can't meet the mortgage they must sell - and the present value of the house will be much less than they owe, so the double whammy is they have to sell and end up still owing money and now have no job!
I hope your own job is secure.

  oresome 11:22 21 Nov 2008

I'm retired, so no fear of losing my job.

But my wealth is tied up in equities that have fallen in value by around 40% this year alone and cash that doesn't keep up with inflation. The outcome is that I don't make any discretionary major expenditure, like buying a new TV or car. We've put a house move on hold, so new carpets, curtains and all the other purchases that go with it get put back.

If others do the same, you can see that many businesses will struggle to survive, which in turn harms my equity investments further.

  carver 12:11 21 Nov 2008

Quite true, these people who don't believe this economy downturn will not effect them, have not had it come to their door yet, but it will.

If you are already retired then your pension is most probably safe, if you plan to retire in the next few years then I feel sorry for these people because their pensions could be a lot less than they think.

A work colleague of my wife was very smug about it and was telling every one how this wouldn't effect her or her family, well 3 weeks ago her dear hubby was told he was no longer needed at the window company he worked for, he's still looking for work.

fourm member

This goes a lot deeper than a few people borrowing more than they can afford, for some people the only way to get a house was to borrow to the limit, council houses have all but gone, banks lent money when they shouldn't have, and it was all done to allow the economy to grow. So please don't sit there all smug and say it's their own fault, some people have had no choice but to go with the conditions set out before them.

  sunnystaines 13:57 21 Nov 2008

people are now starting to save, but its taken years to get the message through, now the tables have turned and people are being told go out and spend to save industry.
had common sense been used in the first place by all we would be better to deal browns credit crunch.

the future disaster in years to come is interest only mortgage so many young people have these with no back up and it will all hit the big fan.

  peter99co 16:34 21 Nov 2008

I feel sure about 18/24 months ago I heard someone say that Brown's bubble was going to burst and I can't find the article. It must have been in a TV broadcast. How right they were!

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