Want a mortgage then you have to face this.

http://www.telegraph.co.uk/finance/pers ... tions.html


A bit late. This should have been in place for years.

Decades really.

Yes especially before a property bubble occurs. I wonder what the reason for it starting now is?

At a wild guess, it could be irresponsible loaning of money by the banks and rampant fraud by people "desperate" to buy a house at any cost.

More likely the rampant fraud by mortgage brokers desperate to flog loans to complete lemons.

I would totally agree to the later almost always, but at the moment the banks are being sensible and only lending to people who are likely to pay back. So that is not necessarily the reason now. I do hope that they keep this permanently so that it stops such fraud.

Well if you declair to HMRC that you earn £50K (and pay tax on that)
but
For your Mortgage application you say you earn £100K
then somewhere you are lying and either
hiding money for HMRC and so owe back tax
or
have fradulently filled in a loan application and so will go to prison

The choice as they say is yours

I totally support that reasoning. It should have been there for years. I think in the past the lenders were very slack in terms of lending criteria and so as you say fraudulent loans were given, but many people also did it as their only way of getting on the property ladder. The property owning democracy is over. Over the next few years prices will slump and its attraction as an investment will vanish. It never should have been allowed to get to such levels. Many people would not be facing homelessness if property prices had been stable. The whole property market has turned out to be a giant Ponzi scheme requiring more people to buy at ever higher prices to sustain them. With real wages stagnant in the UK since 2003 the property bubble was doomed.

I agree



Unfortunatly with a very fixed supply and increasing demand (more single households, net migration in etc) there is increasing demand. This is fueling an increase in rents so although the large capital gains may have gone for the "buy to rent" people they are still making a very good return on thier investment by increasing rents (returns). This means that prices will stay stable for some time to come - personally I think they will stay static and so will be erroded by inflation rather than any dramatic falls

I had to send the mortgage broker a form from the revenue which stated my declared earnings for the last three years. SA302 iirc. ps I am 1 month in yay.

Yes but we also have deliberately constrained supply. There are hundreds of thousands of empty properties which lie vacant. If these were forced into use again by council taxes being collected then these properties would cost their owners substantially unless they let them or sold them. This would bring back property into use.

Also a study in the US found that low property taxes were actually a factor in the property bubble. With lower property taxes people found that they had more money and so used that extra income to borrow even more inflating the property bubble. All that extra income saved was transferred straight to banks in higher loan repayments. So with lower property taxes were you actually any better off? No. It might have seemed that way with a higher property valuation but all it did was cause the borrower to become more reckless.

One thing that worries me about this:
In my experience, HMRC couldn't organise a piss up in a brewery! They're probably ruin the chances of many people of getting the house they want by mistake.

Possibly but are people going to wait till the last moment to get a mortgage? If they did it in advance they will have a budget to work within.

I may have slightly exaggerated my earnings in order to get a mortgage. The broker positively encouraged me to do so. It went like... "I get overtime, I'm hoping for loads, and the car is worth 4K and there's my on-call payment and can I add expenses?" - the total was nearly double my actual pay.

However, I chose a fixed interest rate and repayments I knew I would be able to meet. It's less than the rent on a 1 bed flat in a cheap part of London...

Yes but as long as you are still able to pay the mortgage, and with these low rates should be overpaying while you can, then it should not be a problem unless you plan on remortgaging.