Nationwide calls time on the Bank of Mum & Dad.

Semple said:
What on earth actually is document duty? Your legal feels look pretty similar to the UK, but no idea what this document duty is. Is that some sort of tax the Guernsey government have? Do you have a form of stamp duty? - or is this probably it?
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dirtychinchilla said:
I was thinking that. Conveyancing fees down here are maybe £2k.
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Pretty sure document duty is their form of Stamp Tax. Stamp Taxes were literally the price you paid to get the documents officially stamped in ye olden times.
 
Pudney said:
Pretty sure document duty is their form of Stamp Tax. Stamp Taxes were literally the price you paid to get the documents officially stamped in ye olden times.
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In which case, that would make sense. Albeit perhaps a little high for a house worth 276k. In the England the SDLT would be 3.8k (pre the current SDLT exemption phase).
 
Semple said:
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.
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Yeah I was scared by this. I had bitcoin deposits from coinbase on mine. Luckily (it was luck) by time it got to bank statements they only wanted 3 months.
 
Pawnless Endgame said:
I'm with Nationwide, £270/month mortgage locked down for 10 years between 2016 and 2026. Didn't need to use the bank of Mum and Dad, although they did give me some furniture items when I moved in.

Meanwhile, the identical house next to mine (but with a much smaller garden) is rented @ £490/month. They're doing it wrong :p
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£270/month, do you live in a car parking space?? :D (These actually do rent for ~£250/month - not London either)

Or did you already pay a huge chunk of the house off and need a small mortgage to cover the rest?
 
Guest2 said:
£270/month, do you live in a car parking space?? :D (These actually do rent for ~£250/month - not London either)

Or did you already pay a huge chunk of the house off and need a small mortgage to cover the rest?
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My 1 bed flat with rotten cupboards (two doors fell off) a toilet that was so faded the plastic was green, electric heating with a kitchen 1.5m*1.5m was 500 pcm to rent!

My mortgage however is 800.
But still, only 300 more for a 3 bed detached with a big garden.

If you have to rent you need a very decent job to build enough deposit for somewhere OK to live.
 
Guest2 said:
£270/month, do you live in a car parking space?? :D (These actually do rent for ~£250/month - not London either)

Or did you already pay a huge chunk of the house off and need a small mortgage to cover the rest?
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Well he does live in Stafford, where it's quite possible to buy a sub £100000 property...
 
Smaller place next to me is just under £1K PCM to rent.

I am paying £530 or so on the mortgage on this one.

A lot of people just can't get on that ladder though, but when they do inevitably saves some each month.
 
In 2004 I was paying £250/month for a room in a 4 bed semi in Leeds (with 3 other guys)

Mortgage now is £833 for 2 bed/2 bath apartment. I could rent the 2nd room but it's now a WFH room / guest room. Plus I wouldnt want the hassle of renting and living with someone (other than my girlfriend)
 
Makes sense: surely someone's going to be statistically lower risk to the bank if they have already demonstrated financial responsibility by saving up a deposit, vs someone just gifted it by parents.
 
Rotty said:
only people we take on these days are from A levels, into apprenticeship and them permanent, not taken a graduate on for a very long time
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Why? (why not take on a graduate)

There were plenty of jobs that were looking for degrees when I left uni. I did leave in 2008 though
 
cheesyboy said:
Makes sense: surely someone's going to be statistically lower risk to the bank if they have already demonstrated financial responsibility by saving up a deposit, vs someone just gifted it by parents.
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This.
I would be interested to know the technical bits surrounding the savings.
If it's 3 months of previous records, all that peolpe need to do is receive the money 4 months+ in advance. Show the 3 months of bank statements and jobs a goodun
 
Werewolf said:
Or they're looking ahead and seeing an issue with people who maybe got a large amount towards their deposit from their family to be able to get the mortgage,but may not be able to keep up with the repayments.

They may be remembering a few years back when people were getting loans outside their ability to pay, and are trying to prevent a problem before it gets bad, especially if they're expecting the economy to take a downturn and people to have less money.
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Exactly this in my view. In October/November, the UK could have between 4 and 6 million people unemployed. The USA already has over 30 million unemployed and rising. Once furlough payments end, the economy will take a big nosedive. Although not the same, in the 1990's the UK left the ERM, the economy went into free fall and interest rates shot to over 15%. I'm not saying that interest rates will go as high, but they could. I doubt very much that anyone on here that has a £250,000+ mortgage would ever be able to afford the monthly payments even at 10%, let alone 15%. Nationwide are doing the right thing at the moment because they know this is coming. I wouldn't be in the least bit surprised if other lenders follow suite, some may go even further than Nationwide.
 
Surely it's on them to disprove it?

But there are so many loopholes. E.g. the parents could just pay the kid some kind of "consultancy fees" for whatever you like. It's not a gift on paper.

Psycho Sonny said:
There are options available.

Second job, cut down on expenditure.

You can buy a flat in Paisley for £20k.

That at least gets you on the ladder. Let's you build up equity and savings to then move up the ladder when you can.

If you want something badly enough you can make it happen.
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Unless it's a posh flat in the middle of London, you won't climb the ladder with it. You might lose money (a friend did, lost about £20k over 10 years). Buy a small or run down house (then fix it up) in a nice area if you want to make the most.
 
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Nasher said:
Surely it's on them to disprove it?

But there are so many loopholes. E.g. the parents could just pay the kid some kind of "consultancy fees" for whatever you like. It's not a gift on paper.



Unless it's a posh flat in the middle of London, you won't climb the ladder with it. You might lose money (a friend did, lost about £20k over 10 years). Buy a small or run down house (then fix it up) in a nice area if you want to make the most.
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What are you talking about?
 
kitfit1 said:
Exactly this in my view. In October/November, the UK could have between 4 and 6 million people unemployed. The USA already has over 30 million unemployed and rising. Once furlough payments end, the economy will take a big nosedive. Although not the same, in the 1990's the UK left the ERM, the economy went into free fall and interest rates shot to over 15%. I'm not saying that interest rates will go as high, but they could. I doubt very much that anyone on here that has a £250,000+ mortgage would ever be able to afford the monthly payments even at 10%, let alone 15%. Nationwide are doing the right thing at the moment because they know this is coming. I wouldn't be in the least bit surprised if other lenders follow suite, some may go even further than Nationwide.
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If interest rates went to 15 pc and were at that point at mortgage renewal time I bet swathes of the country would go bankrupt. I sure would.
 
kitfit1 said:
Exactly this in my view. In October/November, the UK could have between 4 and 6 million people unemployed. The USA already has over 30 million unemployed and rising. Once furlough payments end, the economy will take a big nosedive. Although not the same, in the 1990's the UK left the ERM, the economy went into free fall and interest rates shot to over 15%. I'm not saying that interest rates will go as high, but they could. I doubt very much that anyone on here that has a £250,000+ mortgage would ever be able to afford the monthly payments even at 10%, let alone 15%. Nationwide are doing the right thing at the moment because they know this is coming. I wouldn't be in the least bit surprised if other lenders follow suite, some may go even further than Nationwide.
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Covid still lingering on even over the winter along with Brexit means the UK is in for a real tough time for potentially years.
 
I even checked 10pc interest rate. Yeah , that would be unsustainable too for me

Be intersting to know how many people would go insolvent as you raise interest rate

I expect even 5pc would be a struggle for a lot
 
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