This week’s first comment is in response to: Skipton’s 100 per cent LTV product ‘welcome step in the right direction’ ‒ analysis
Terry Arch said: “I am concerned about this. On the assumption that the average house price is £200,000 at the lower end, this would cost circa £1,100 per month over the maximum term of 40 years.
“If someone is only paying £750 per month rent and has no savings, there would have to be some serious underwriting to suddenly increase their outgoings by £350 per month. The idea is good but, in reality, I do not think it is the holy grail.”
He continued: “This is at the lower end of the market, it will show up more if the prices are £250,000 to £300,000 which most prices are. Yes, there may be cases of negative equity, but bearing in mind that the purchase of your home is a long-term commitment.
“If mortgages payments are kept to, there should not be a reason to sell unless personal circumstance dictates or interest rates continue to rise and the payments become untenable. We must consider the 100 per cent loan to value (LTV) mortgages that were issued by Northern Rock and interest rates increased which did cause a lot of problems at that point.”
‘Landlords are being squeezed by extra taxes and more red tape’
This week’s second comment is in relation to: The Co-op Bank teams up with Shelter to call for a fairer private rented system
Michelle Lawson said: “I am quite shocked and saddened to read this in a lot of ways. As an ethical lender, is The Co-operative aware that Shelter recommend that tenants stay in situ when notice is given and advise the tenants to wait until courts and bailiffs evict?
“This could cause issues for their buy-to-let book for landlords with non-paying tenants. I support the cause of tenants to a point but so many have had it so good for so long. Landlords are being squeezed by extra taxes and more red tape.
She continued: “On top of this, when tenants mistreat properties or don’t pay rent, there is little support to enable landlords to get the tenants out, causing many landlords financial hardship as only the tenant or the courts can end a tenancy.
“Landlords have been ‘kind’ to tenants by not increasing rents for many a year and then the tenants aren’t happy when market conditions put pressure on to raise the rent. They forget the number of years they have benefitted from lower-than-market rent.”
“Many landlords are exiting the sector due to all of this which is adding further pressure to the housing crisis. There are so many easy fixes, however giving tenants more power than they have already is not necessarily the right thing unless it is done properly with support from people like Landlord Action and the NRLA.”
The comments here are from our readers and do not necessarily reflect the views of Mortgage Solutions and Specialist Lending Solutions.
