People have been warned that even with big deposits, high incomes and good credit records they may still be refused a mortgage. Nationwide, Britain’s biggest building society, recently refused a mortgage request from a long-standing customer who had a 50 per cent equity in his £1.4 million property, a six-figure income and clean credit record, because he was self-employed.
Over at Cheltenham & Gloucester, brokers have been instructed that borrowers with more than £100,000 in bonuses should be referred to underwriters and will need to provide their bonus history for the past two years, while providing details of anticipated bonuses and the method they will be paid.
And Skipton, the sixth largest building society in the UK, became the first major lender to charge borrowers to take out a standard variable rate loan, leading to accusations that lenders were profiteering from the credit crisis. This all comes as figures out from Rightmove indicate that one in three housing deals is failing as lenders tighten their belts.
Increasing numbers of people who have mortgage shortfalls and other debts dating back as far as the 1990s, are now being threatened with court action. Last year, UK banks sold off a record £7 billion in unpaid consumer debts to collections agencies for a ‘pittance’. A growing number of consumers who lost their home in the 1990s are now being pursued by lenders who had previously let the debt slide, according to Citizens Advice,
These figures were announced as a senior member of the treasury select committee attacked the government for failing to help families threatened with losing their homes in the credit crisis. George Mudie called on the government to strike a deal with lenders to delay repossessions and help struggling homeowners through short-term difficulties. Nearly 40 Labour MPs have now signed a commons motion warning that a ‘large and growing number of houses’ will be repossessed because of the credit squeeze and urged councils to buy up empty houses and allow former owners to stay ‘under their own roof as council tenants’.
The Association of British Insurers (ABI) is calling on all new homes to carry a kitemark, proving they are built to withstand floods. The trade body, which represents 94 per cent of the UK home insurance market, has paid out more than £3 billion for 180,000 claims from last year’s flooding. It is calling on a minimum construction standard that would provide consumers with more confidence in a property’s ability to withstand a flood.
And finally, what do you give the billionaire who has everything? A billionaire housebuyer, who plans to turn a vacant London house into one of the world’s most expensive homes, found his new property came with everything – including a squatter. He is unable to remove the man who has been living on the grounds for the past 21 years, as he was awarded squatters’ rights last year. The house in Highgate, north London, is estimated to be worth £130 million when it is finished; less, of course, the £4 million for the small plot in the garden that Mr Harry Hallowes, the squatter, has rights over.