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  • Mortgages & Finance

    Will Bank stay neutral or will they never lend me again?

    Hello,
    What I want to do now is to say Thank you Vanessa, Lisa and John.
    Tomas Smile
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    hi lisa , vanessa , i agree with you both regarding the point that if you borrow money then you should pay it back. but in certain circumstances i think it is warranted. ie the banks moving the goalposts has left a lot of investors high and dry with high credit card and personal debt. in one case that i know of an investor has over 250k in credit card debt that he used for deposits etc , planning on remortgaging the properties to pay back the credit cards. he has over 30 properties , all bought bmv with enough equity to easily pay off the CC . but the banks wont give him a mortgage because of his unsecured debt that they happily gave him as he has a good credit history. so now he finds himself with high interest payments on CCs and also if the rate goes up he will not be able to switch lenders so therefore paying higher payments. if i found myself in this position because of banks moving the goalposts, and someone offered me a way of walking away from the debt, i think i would gladly walk away from it. would like to hear your thoughts on this lisa and vanessa, cheers, tam
    LisaOrme said:
    That was my point earlier Tomasz; you were mis sold PPInsurance which is quite common and not right.However there are companies who are using technicalities to get credit agreements over turned. That's a whole different thing. To me you if took the money you pay it back.Kind regards, Lisa
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    hi peter, the problem isnt LTV . the banks are turning him down because of his unsecured debt to earnings ratio, but it was the same banks that were happy to give him the credit card debt in the first place. he simply wants to replace his unsecured debt with secured debt. also its not straightforward to sell properties when you have tennants in them. cheers, tam
    Peter Herd said:
    HI Thomas,My advice to this investor would be to sell some or all of the properties to limit there exposure to high credit card debt. If this investor is paying high interest credit cards no rental income will cover the minimum payments on these cards. It is more than likely that this person falls outside of the loan to value criteria of most lenders and therefore will struggle to get remortgage.Better to sell a small loss then carry on with an investment strategy that could potentially wipe you out.Moral of the story is better business plan that has a clear exit strategy without over borrowing.Peterthomas gallagher said:
    hi lisa , vanessa , i agree with you both regarding the point that if you borrow money then you should pay it back. but in certain circumstances i think it is warranted. ie the banks moving the goalposts has left a lot of investors high and dry with high credit card and personal debt. in one case that i know of an investor has over 250k in credit card debt that he used for deposits etc , planning on remortgaging the properties to pay back the credit cards. he has over 30 properties , all bought bmv with enough equity to easily pay off the CC . but the banks wont give him a mortgage because of his unsecured debt that they happily gave him as he has a good credit history. so now he finds himself with high interest payments on CCs and also if the rate goes up he will not be able to switch lenders so therefore paying higher payments. if i found myself in this position because of banks moving the goalposts, and someone offered me a way of walking away from the debt, i think i would gladly walk away from it. would like to hear your thoughts on this lisa and vanessa, cheers, tamLisaOrme said:
    That was my point earlier Tomasz; you were mis sold PPInsurance which is quite common and not right.However there are companies who are using technicalities to get credit agreements over turned. That's a whole different thing. To me you if took the money you pay it back.Kind regards, Lisa
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    Tomasz,
    On the subject of ethics, I agree that trying to have the capital sums borrowed "written off" is entirely un-ethical however, I also agree that should you have been mis-sold an additional service ie PPI which you paid a premium for with no real value, then you should be entitled to compensation.
    I totally agree that you should pursue this matter yourself but using a very valuable area of resource.
    https://www.consumeractiongroup.co.uk
    This is a forum that has some very experienced and helpful members and contains drafts of all of the letters etc that you may need to use in your pursuit of compensation.
    There are also many members who will proof read your submissions etc. in advance.
    Anyway, try it out and I wish you all the best.
    Regards
    Rob
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    Sorry Tam but I disagree.
    This investor racked up 250k of CC debt all by himself. No one especially not the banks forced him to do that. Whether he used it to buy properties or TVs doesn’t matter.
    He took it he pays it back.
    To say the banks moved the goal posts on him is poppycock!
    The fact that lending was so easy previously to allow him to get that level of debt and then they move the goal posts to more sensible lending is not an excuse to have it written off!
    In fact as a tax payer and a credit card and bank user i’d be mighty peed off to find my rates going up in the future because someone like this used one of these companies to get their debts written off! Someone pays for it along the line.
    KR, Lisa
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    Lisa All comments are for education and information purposes only and do not construe as advice or a financial promotion. No liability is accepted for comments made. If you wish to receive information in an advisory capacity then please contact me about becoming a client. www.keys-mortgages.com

    hi lisa, i am not saying that the reason for writing off the debts is that the banks have moved the goalposts. im not naieve enough to think that such an argument would stand up in court. what i mean is that if i borrow money then i should pay it back , but in the circumstances that this guy finds himself in then it is understandable why , if given the option of walking away or potentially going bankrupt and losing his entire portfolio then in his case i dont think you could blame him. i also take on board your point that he did borrow the money of his own free will, but i think in light of the amount of tax payers money that was pumped into these banks then i think it is also responsible lending practise to allow him to remortgage his properties in order to clear the credit card debt and so allowing him to pay the money he owes whilst still being cashflow positive and keeping his investments. its easy in hindsight to criticise people for borrowing large sums of money when credit was easy to come by , only to come unstuck when the banks turn off the taps. personally i dont think it would be possible to write off these debts , but if such an avenue was open to him then i wouldnt criticise him for taking it. cheers, tam
    LisaOrme said:
    Sorry Tam but I disagree.This investor racked up 250k of CC debt all by himself. No one especially not the banks forced him to do that. Whether he used it to buy properties or TVs doesn’t matter.He took it he pays it back.To say the banks moved the goal posts on him is poppycock!The fact that lending was so easy previously to allow him to get that level of debt and then they move the goal posts to more sensible lending is not an excuse to have it written off!In fact as a tax payer and a credit card and bank user i’d be mighty peed off to find my rates going up in the future because someone like this used one of these companies to get their debts written off! Someone pays for it along the line.KR, Lisa
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    Hi Rob,
    Thank you for your advice Smile

    Rob Hubbard said:
    Tomasz,
    On the subject of ethics, I agree that trying to have the capital sums borrowed "written off" is entirely un-ethical however, I also agree that should you have been mis-sold an additional service ie PPI which you paid a premium for with no real value, then you should be entitled to compensation.
    I totally agree that you should pursue this matter yourself but using a very valuable area of resource.
    https://www.consumeractiongroup.co.uk
    This is a forum that has some very experienced and helpful members and contains drafts of all of the letters etc that you may need to use in your pursuit of compensation.
    There are also many members who will proof read your submissions etc. in advance.
    Anyway, try it out and I wish you all the best.
    Regards
    Rob
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