Comments on: Now the UK government wants banks to bail out borrowers http://monevator.com/2008/04/23/now-the-uk-government-wants-banks-to-bail-out-borrowers/ Make more money, invest profitably, retire early Sat, 11 Feb 2012 01:13:50 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Toby http://monevator.com/2008/04/23/now-the-uk-government-wants-banks-to-bail-out-borrowers/comment-page-1/#comment-324 Toby Wed, 23 Apr 2008 18:12:47 +0000 http://monevator.com/2008/04/23/now-the-uk-government-wants-banks-to-bail-out-borrowers/#comment-324 Couldn't agree with you more, and I'm speaking as someone who extended themselves moving up the ladder in the peak of last summer. I wasn't completely foolhardy though. I did my worst-case scenario planning and put down 25%, however I was near the top of the multiples and have since spent all remaining funds modernising the property, money I know hasn't increased the value of the property by anywhere near as much as I've spent. The house purchase wasn’t an investment decision, it’s a long term purchase that suited my growing family needs and our current work situation, but as it stands it’s currently the worst financial decision of my life. Since the end of last year I’ve had to endure watching the credit crisis unfold as my finances dwindled with the costs of building work. It couldn't have happened at a worse time for us financially. However I'm fairly lucky in that I'm not a believer of credit other than mortgages so I don't have credit card/overdraft/loan repayment issues. I can afford to pay 7% on the mortgage. Much more than that and it will be painful. The problem is that I need to remortgage at the end of the year and my 25% deposit will likely have shrunk with the fall in value in the property, so I'm frantically saving every penny to try and put myself in the best possible position so I can put down the same 25% in the hope of getting the best deal possible. However I have no idea how much of a fall I need to cover to make that 25%. Having said all that, I find the whole crisis fascinating, as I have an interest in economics and finance in general. I think the government has been negligent in letting things get to where they are. There was no way the housing market could keep going at the rate it has been growing, the government should have done more to keep it growing at a more sustainable rate. I have a feeling banks will be forced to change they way they operate in future, but the real villain of this story is our very own Gordon Brown. I really hope this serves as a wake up call to the nation, that people start taking responsibility for their finances, that money doesn’t grow on trees, and that lenders take more care when lending. And that all this happens without sending the country into a painful recession and downward spiral. Fingers crossed. Couldn’t agree with you more, and I’m speaking as someone who extended themselves moving up the ladder in the peak of last summer.

I wasn’t completely foolhardy though. I did my worst-case scenario planning and put down 25%, however I was near the top of the multiples and have since spent all remaining funds modernising the property, money I know hasn’t increased the value of the property by anywhere near as much as I’ve spent. The house purchase wasn’t an investment decision, it’s a long term purchase that suited my growing family needs and our current work situation, but as it stands it’s currently the worst financial decision of my life.

Since the end of last year I’ve had to endure watching the credit crisis unfold as my finances dwindled with the costs of building work. It couldn’t have happened at a worse time for us financially. However I’m fairly lucky in that I’m not a believer of credit other than mortgages so I don’t have credit card/overdraft/loan repayment issues.

I can afford to pay 7% on the mortgage. Much more than that and it will be painful. The problem is that I need to remortgage at the end of the year and my 25% deposit will likely have shrunk with the fall in value in the property, so I’m frantically saving every penny to try and put myself in the best possible position so I can put down the same 25% in the hope of getting the best deal possible. However I have no idea how much of a fall I need to cover to make that 25%.

Having said all that, I find the whole crisis fascinating, as I have an interest in economics and finance in general. I think the government has been negligent in letting things get to where they are. There was no way the housing market could keep going at the rate it has been growing, the government should have done more to keep it growing at a more sustainable rate. I have a feeling banks will be forced to change they way they operate in future, but the real villain of this story is our very own Gordon Brown.

I really hope this serves as a wake up call to the nation, that people start taking responsibility for their finances, that money doesn’t grow on trees, and that lenders take more care when lending. And that all this happens without sending the country into a painful recession and downward spiral. Fingers crossed.

]]>