Nationwide calls time on the Bank of Mum & Dad.

Psycho Sonny · 10 Aug 2020 at 01:49

MissChief said:
Come on, you know the monthly payment isn't the issue, it's saving the deposit. I pay £650 a month in rent and live alone. A mortgage on my house would be somewhere in the region of £350-£400 a month. I just can't save for a deposit due to sky high rent. It's the same for hundreds of thousands of people across the UK and it's these people the BTL lot take advantage of.

Rent somewhere cheaper.
Get a lodger.
Move in with someone else?

There are options available. Including moving in with parents temporarily if need be.

Plenty of people in London decided to build their own home out of storage containers or by using a trailer chassis as the base or even converting a boat into a home and living on the canal.

Akagi · 10 Aug 2020 at 02:14

What the ****? :confused:

That seems like a bizarre thing to enforce... As if getting on the property ladder isn't already hard enough for this generation?

MissChief · 10 Aug 2020 at 03:00

Psycho Sonny said:
Rent somewhere cheaper.
Get a lodger.
Move in with someone else?

There are options available. Including moving in with parents temporarily if need be.

Plenty of people in London decided to build their own home out of storage containers or by using a trailer chassis as the base or even converting a boat into a home and living on the canal.

Somewhere cheaper so I can save £200 a month? Great, it'll only take me 5 years to get the 20% deposit required, by which time house prices will have likely increased by over 50% so my £20k won't be enough. You make it sound so easy mate.

I'm 45, my parents wouldn't want me back and I wouldn't want to live there. Christ my eldest brother stays there at the moment! Mind you their house is paid off so once they shuffle off my brothers and I will move back in LOL.

almoststew1990 · 10 Aug 2020 at 08:50

I would have been so ****** if I was told this when we got our first mortgage. We did everything "right": No debt outside of one student loan. Drive a crap car instead of spending hundreds a month on one. Both had credit cards paid off every month. No expensive holidays. Bought a few things on finance over a 3 or 6 month period instead of paying up front to get our credit score up. Our mortgage was quite a bit less than the maximum we could borrow. And we had an excellent credit score. I would have walked out and possibly taken my savings account with me if I was feeling dramatic!

413x · 10 Aug 2020 at 08:57

Jokester said:
Surely the source of the deposit is irrelevant. It’s the purchaser’s ability to make the monthly payment that is the important bit, or have Nationwide been assuming that by having a deposit that they’re somehow otherwise good for the mortgage repayment regardless of ongoing income?

Edit:
Or are the bank facing issues due to inheritance tax?

Weird decision.

Rent is crippling. Some people can never get a deposit if they are in an expensive rental.

We had to live in a one bedroom grotty flat to accelerate saving for a deposit. I could easily afford the mortgage. Also, more deposit you get, smaller your. Mortgage payments.

But its up to nationwide. Other providers are available. I guess they have enough business to do this. And it obviously does reduce risk.. I guess

PermaChanged · 10 Aug 2020 at 09:01

MissChief said:
Come on, you know the monthly payment isn't the issue, it's saving the deposit. I pay £650 a month in rent and live alone. A mortgage on my house would be somewhere in the region of £350-£400 a month. I just can't save for a deposit due to sky high rent. It's the same for hundreds of thousands of people across the UK and it's these people the BTL lot take advantage of.

This.

I'm very fortunate in that I am on the property ladder now, but in terms of savings to get me on that ladder it was nigh on impossible whilst renting, and I had to move back in with my parents to do so.

Throughout the years I'd rented places that were between 50% and 60% of my monthly income (+ bills), now with a mortgage I'm paying 30% of my monthly income (+bills).

The ridiculous part of buying where I live is the legal fees and other fees involved - the property I bought was £276k, with a 10% deposit and fees it cost me ~£39k to complete.

theone8181 · 10 Aug 2020 at 09:04

I can see some issues with this, when I lived at home my 'board' money went straight to my parents, however when it came time to move out they gave it back which was part of my deposit (I didn't know they would do it at the time but seems like a good idea). So my deposit ended up being ~50k which was around 25% deposit on our house. There's a guy I'm working with and despite his rent being £800 a month, the bank think a £500 a month mortgage is to much :confused:

. Don't get how these people think (between him and his Mrs they're saving close to a grand a month too).

Semple · 10 Aug 2020 at 09:09

Can't really see how it'll work in practice. If parents "gift" you a large proportion of the deposit quite a bit in advance - say 12 months. Mortgage advisors/brokers only ask for the last 3-6 months. Assuming you're not a 21 year on on 17k a year with a 100k deposit to put down, if it's relative to your salary then the MA/broker isn't going to look too much into it.

I thought it was a bit of a farce when all we had to supply was 3 months bank statements, showing that the balance of our deposit was in our account for 3 months. It's basically a tick-box exercise.

Semple · 10 Aug 2020 at 09:12

PermaChanged said:
The ridiculous part of buying where I live is the legal fees and other fees involved - the property I bought was £276k, with a 10% deposit and fees it cost me ~£39k to complete.

Were you not a FTB? 11.5k in purchase fees seems pretty steep.

I wouldn't have expected to pay anymore than 2k on legal fees, 1k on surveyor costs. Anything extra would normally be SDLT.

m@rty · 10 Aug 2020 at 09:17

Yep £11.5k in fees is mental!

MissChief · 10 Aug 2020 at 09:20

theone8181 said:
I can see some issues with this, when I lived at home my 'board' money went straight to my parents, however when it came time to move out they gave it back which was part of my deposit (I didn't know they would do it at the time but seems like a good idea). So my deposit ended up being ~50k which was around 25% deposit on our house. There's a guy I'm working with and despite his rent being £800 a month, the bank think a £500 a month mortgage is to much. Don't get how these people think (between him and his Mrs they're saving close to a grand a month too).

There really needs to be some sort of system to keep track of rent payments. I’ve never missed a payment in nearly ten years but this matters not to the bank.

PermaChanged · 10 Aug 2020 at 09:21

Semple said:
Were you not a FTB? 11.5k in purchase fees seems pretty steep.

I wouldn't have expected to pay anymore than 2k on legal fees, 1k on surveyor costs. Anything extra would normally be SDLT.

Yes it was an FTB, but I'm not in England - I'm down in Guernsey where things are a bit mental

UTmaniac · 10 Aug 2020 at 09:41

Unless other lenders aren't offering 90% LTV mortgages, FTBs like us will simply go elsewhere.

We've been in the same rented flat for ~14 years, trying to save a deposit was practically impossible until my better half started working ~5 years, but over that time we've paid almost £100k in rent. We could possibly stretch to buying a ~£160k property including our ~20% deposit, but that's not going to buy a house in Hampshire unless the market floor drops massively and the flat options in not so grim areas of Southampton are few and far between.

Both being in our 40s, we need to get on the ladder ASAP, I really don't want to paying off the mortgage right up to the day I retire.

Diddums · 10 Aug 2020 at 09:43

Lol Nationwide. I wouldn't go anywhere near them anyway, their ads were enough of a cancer to put me off for life.

MichaelAwkward · 10 Aug 2020 at 09:50

UTmaniac said:
Unless other lenders aren't offering 90% LTV mortgages, FTBs like us will simply go elsewhere.

I doubt Nationwide cares? They'll have made this decision based on the data available to them weighed against the potential loss of business.

Outcast440 · 10 Aug 2020 at 10:01

stockhausen said:
Nationwide has decided that in order to get a mortgage with a 10% deposit, a prospective house buyer must now prove that they were given a maximum of 25% of that deposit by a parent or grandparent - they must show that the remaining 75% comes from their personal savings.

that sounds like some Jeremy Corbyn-type scheme - I mean, if you're selling something, who cares where the money comes from right, as long as it's legal

Semple · 10 Aug 2020 at 10:05

PermaChanged said:
Yes it was an FTB, but I'm not in England - I'm down in Guernsey where things are a bit mental

Blimey, are surveyor costs just expensive? or are there additional things that get added to the legal costs?

HungryHippos · 10 Aug 2020 at 10:06

MissChief said:
Come on, you know the monthly payment isn't the issue, it's saving the deposit. I pay £650 a month in rent and live alone. A mortgage on my house would be somewhere in the region of £350-£400 a month. I just can't save for a deposit due to sky high rent. It's the same for hundreds of thousands of people across the UK and it's these people the BTL lot take advantage of.

£20k deposit isn't bad, can't get anything on that where you are?

Diddums · 10 Aug 2020 at 10:07

Outcast440 said:
that sounds like some Jeremy Corbyn-type scheme - I mean, if you're selling something, who cares where the money comes from right, as long as it's legal

Nationwide is one of those rather irritating institutions that's always trying to get on its moral high horse and "be there for you" - if you're one of the people who appreciates this then crack on, but all I want a business to do is their job and keep their BS opinions to themselves. You're a service provider, so provide a service, job done.

Scam · 10 Aug 2020 at 10:22

413x said:
Rent is crippling. Some people can never get a deposit if they are in an ~~expensive~~ rental.

I fixed it for you. All rentals are expensive and overpriced

I used to work with a guy who lived round the corner from me. He was about 20 years older than me though so owns a small 3 bed semi. He nearly **** a brick when I told him how much my rent was on a small 2 bed flat. He was so embarrassed he wouldnt even tell me how much (little) his mortgage was. So, this was a guy who was probably 2 levels senior to me, earning probably twice as much, paying probably a third of my rent on his mortgage. And you wonder why the <40s are screwed when it comes to the housing market.

HungryHippos said:
£20k deposit isn't bad, can't get anything on that where you are?

£20k wouldn't quite be a 10% deposit on the average house price in the UK (£230k).

I'm not seeing a link from the OP. I'm not sure I totally understand what all this means. If my parents want to gift me money towards a deposit does this mean Nationwide won't give me a mortgage? Well they can go suck a **** as far as I'm concerned! How exactly is anyone in the SE supposed to buy their first home? :confused:

This makes for interesting reading; https://www.legalandgeneral.com/lan...t/reports/bank-of-mum-and-dad-report-2017.pdf In the last 5 years, over 60% of FTBs under 35 received help from their parents... The bank of Mum and Dad is lending so much it's the equivalent of the UK's 9th largest mortgage lender

I don't know what Nationwide are thinking...

EDIT:

MissChief said:
There really needs to be some sort of system to keep track of rent payments. I’ve never missed a payment in nearly ten years but this matters not to the bank.

There is but not sure how well it works; https://www.experian.co.uk/business...anagement/rental-exchange/tenant-information/ There was a scheme whereas you paid your rent to a middle-man who then paid it to your landlords. Thus 'proving' you were good for it. I don't know if this is the same thing or what.