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This is a normal post So basically,
they're going to give the banks even more money for the debts that the banks will never collect on anyway?
(, Fri 9 Nov 2012, 21:07, Reply)
This is a normal post They have
Already collected on them.

They sell the bad debts to some fund manager types, they then pool these bad debts, sorted by type, demographic and risk. Once pooled these can go back into the market as bonds. These bonds have a whopping return, with little risk - since mean people will arrange full fat collections. Even a semi skimmed collection will still heap an enormous profit.

The banker doesn't lose anything by getting rid of the bad debt, it's good sense. But he makes a good return on trading on the bonds.

The value of these bonds is dependent of the evils of the debt collecting agencies, many people on here have dealt with the Moorcrofts of the world. They destroy people, families and futures.

I think this is a good idea, in principle, though I can't see how it will work - since debt will not likely be sold to a group who will make it's value worthless - several moles in the system could prove interesting for the markets, I suppose!

Edit: Also it isn't about the banks - it's about the shackles and control of debt. Debt is the single worst thing peddled by our democratic overlords.
(, Fri 9 Nov 2012, 21:21, Reply)
This is a normal post "Debt is the single worst thing peddled by our democratic overlords."
Bunkum and hogwash. Debt is not a bad thing per se, without it I stood precisely zero chance of affording a flat on my own, and would still be paying rent in a flat share. Getting a mortgage has freed me from paying someone else for a roof over my head.
(, Fri 9 Nov 2012, 21:35, Reply)
This is a normal post LOL
"Getting a mortgage has freed me from paying someone else for a roof over my head."
(, Fri 9 Nov 2012, 21:36, Reply)
This is a normal post Err.
When I get to the end of the mortgage, I still have the roof. It's a fixed term arrangement that allows me to buy something I had no hope of affordin otherwise. Renting is open ended and I have nothing to show for it at the end. How can you possibly look at that as anything other than a good thing?

Or are you just too stuck in the "Banks are evil fascist pigdogs" mindset to think about it?
(, Fri 9 Nov 2012, 21:48, Reply)
This is a normal post Mortgages

Are only a tiny aspect of the debt which is crippling many people - and luckily in the UK at least, they are pretty hard to collect on should the mortgage start to default; overdrafts, credit cards & store cards - more easily obtained *unsecured debts* are really what I was talking about.

Though an interesting fact about UK mortgages, unlike the majority of the rest of the world, is that your property, although acting as the security for your loan; does not free you from the debt of the mortgage should the value of your home not cover your mortgage debt. So if you owe 500K on your mortgage and the bank gets arsy because you are disabled following a car crash - the bank could auction your home for 300k and you would still be personally liable for the 200k + costs shortfall.

I am very pleased that you are happy with your mortgage, and I am sure you got very good rates, but in these times I am extremely surprised that it costs less to buy than to rent + save - especially as an individual. Unless you have interest only of course, in which case I hope you are saving anyway. House pricing are stagnant and there is currently not a great sign of them increasing in value too soon, so equity isn't your big thing there. Even with a full mortgage, you only pay the house value off in the latter 6 years or so, thanks to compound interest. maths removed.

I think mortgages after a hefty deposit, in a stable neighbourhood with a stable job and savings + plus a low maintenance house = win. I think renting with zero risk + saving / investing = win.

I think pushing credit cards, overdrafts, 100% mortgages, ancillary insurance + other costs on Joe Public to enable him to keep up with the jones' is a bad thing.

Renting does not have to be open ended and is certainly not 'nothing to show for it' - you have obviously never done it right, or looked at the maths. Mortgages are not an easy or safe way to get a house. Or are you just too stuck in the 'I must buy a house because that's what the banks told me to do' mindset to think about it ?

It's nice to have the choice and to be able to make an informed decision dependent on your own circumstances. It is not nice to live your life in fear of having everything you own taken away because you can't pay a 5k store card you got last year at Christmas because it came with free shampoo.

(, Fri 9 Nov 2012, 22:16, Reply)
This is a normal post I think your Maths is a little wrong there
A 250k mortgage at 6% interest over 25 years will cost about 450k not 4.5 million!
(, Fri 9 Nov 2012, 22:22, Reply)
This is a normal post Fair point :)
I was guestimating compound interest only for some reason.
(, Fri 9 Nov 2012, 22:31, Reply)
This is a normal post Ok
(, Fri 9 Nov 2012, 22:26, Reply)
This is a normal post i am confused.
(nothing new there) but i think you are lumping too much together there.
the mortgage lending crisis that fucked over the global economy has nothing to do with the nature of mortgages themselves. the root of the entire thing was banks suddenly being willing to write unsafe bets, that inflated home prices due to all this money floating around and people who never should have been extended the amount in the first place default. it was a collapsing house of cards. (not sure about UK regs about disability and whatnot) but it works the same for me here... if i default on my mortgage, and the bank is forced to sell my place, if it goes at a loss, i am still responsible for that difference. as that is the money i borrowed. it only makes sense.
same thing, if i max out my credit cards buying flatscreen tvs and sounds systems... and ooops. cant afford it. that is still my fault. in the long run, owning a house is still a better bet (as long as it was within your budget in the first place) the market will come back, it will be slow, as it was so over inflated.
footnote here.. i am drinking, and you lost me, then i lost why i was writing this reply. i am just rambling, as work brain still may be on. off to look for something pointless to watch. :) all apolo9gies
(, Fri 9 Nov 2012, 23:58, Reply)
This is a normal post Lack of financial "education" played a big part in this too.
It's frightening how naive and "entitled" so many people are when it comes to this subject. Not enough decent education about "money matters" in schools. The prize pillocks in this video are a case in point.
(, Sun 11 Nov 2012, 13:46, Reply)
This is a normal post most definitely.

(, Sun 11 Nov 2012, 17:10, Reply)
This is a normal post The banks/council/energy companies
sell debt to debt collectors for about 10-20p per pound as it is more expensive chasing than cutting your loses. they probably make 30p on each pound. It also means if the debt collectors are going to come round give them a call and offer them about half - they might accept
(, Fri 9 Nov 2012, 21:39, Reply)