'Yes, I'm a subprime borrower' by Finance News Bulletin
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Published: 12/12/07
Liz Jones, writer for the Mail on Sunday, reveals how she came to be a sub-prime borrower, how she's been hit with senior charges and why she can't pay off her mortgageDon't fail to spot our latest advice on clearing the money you owe - and our direct on which debts to pay first
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> money owing calculatorEarly next year, my body will be in use to a hillside, my broken bones to be pecked clean by vultures I will have exhausted my last few months racked with shame, in a cold worry of fearThe words 'If only those Christmas fairy illumination had been designed to last more than one season' will repeat in my brain like a mantra, scornful my profligacyThe reason my way of existence, like that of an indigenous Amazonian Indian, will be at a brutal end
similar to more than a million other British homeowners, my two-year fixed-rate mortgage will expire, and I will be thrown on the mercy of market forcesEven the information that the Monetary Policy Committee has cut a district of a per cent off the base rate has failed to bring cheerIt is all doom fate
How could I have been so greedy, so wantonly optimistic Let me explain that I am a member of that shameful type, the source of all the planet's problems: my name is Liz Jones, and I am a sub-prime borrowerput on't responsibility the greedy banks, or 9/11, or war, or Gordon Brown, or metropolis bonuses, or people who live in Monte Carlo, or supermarket price fixers, or buy-to-let landlords responsibility me
How did I finish up in my sordid cul-de-sac from a normal world of people who unlock their bank statements rather than stuff them in a drawer A few years before, I missed making a minimum payment on a credit-card money owing, an amount of about £25That pushed me into a downward white-knuckle whorl of having to borrow from those ugly daytime TV populace, who then proceeded to intimidate me almost dailyWhere was the Treasury when I was going through my own individual hell
In order to get a mortgage two years ago, I had to disburse £10,000 to Savills Private Finance to secure it, and bear the life sentence of a higher rate of interest, which means I can only have enough money to pay the interest of my huge debtTo build myself some kind of secure future, I then did what I was told by my financial consultant, and invested a huge figure each month in a portfolio of ethical businessesAn investment that has so far meant I have misplaced 75% of what I paid in Argh
I would have been better off filling my money under my Vi-Spring mattressLet me take this instant to moan about High Street banks I have been a NatWest customer since 1978, during which time, so rarely have I been in the black, they have made a pretty packet from me without ever giving me interest on the £13 in my 'Private' (written in a beautiful, italic font) savings explanationNow, it turns out, they no longer write to me when a cheque bounces because that, and I quote, 'is too expensive
It's up to you to be acquainted with how much is in your account'Ah, I told them, but it would have been nice if you had told me you weren't leaving to tell me, to which I have yet to take delivery of a responseBut, hang on a minute Is it fair that I (so many of us
) should be punished for wanting a top over our heads and an alternative to a pension I am fed up with homeowners taking the bruntYes, my London home made me £500,000 in 18 months, but these 'profits', for normal people similar to you and me, are merely relative, if not we don't buy another house and merely move into a (privately owned, restricted authority financed) innHaven't I, by moving twice in the past two years, paid £100,000 in stamp duty into Government treasury, on which I had already paid 40 per cent in income tax
OK, so Britain is built on money owing, but if we all discontinue shopping, won't the economy go pear-shaped Have the authorities changed their mindsDoes anyone else find this method of government (one minute Britain should lead the method on wounding carbon emissions, the next we're told a new landing strip at Heathrow is essential to our economic viability) just plain schizophrenic I used to think my parents were unintelligent for not owning their own home, but now I think they may have been on to something
My disabled mother, who is nearly 90 existence old, was severely means-tested by her local authority before receiving assist to pay for a carerIf she had owned her own home in its place of renting it from a private landlord, she would be forced to disburse all of the cost of a live-in nurse, rather than the semi she pays (which means I pay) nowThe Council of Mortgage Lenders forecasts that 45,000 homes will be repossessed next year, an increase of 50 per centThe Bank of England should be wounding interest rates again, and doing it soon before even more of us are cast into that descending spiral
There is a fairly simple solution as far as I can see £500k is enough to buy a perfectly good family house, perhaps moving out into the suburbs a bit, so if she has made that much profit all she needs to do is put up for sale her current property and pay money for a slightly more modest home and live mortgage free for the rest of her lifeYou were not forced into any of these financial preparations - you entered into them voluntarily expecting only positive outcomes Now it's leaving pear-shaped you are looking for someone to responsibility - try a mirror
You consideration life on easy street would give you something for nothing, and instead that's what you are likely to finish up with - nothingWhile I have some sympathy for the position Liz - and many others similar to her - is in now, it is her own fault, nobody forced her into this and now she is blaming everyone else The artificial 'South East - la la land' financial system is responsible for the house price price rises mess we are in now Houses should be bought as homes to exist in, not assets to trade, and the populace who gambled on interest only loans, suggested by feckless land agents and get rich quick pseudo banks, have compulsory the market into an upward spiral that cannot continue
The majority of us that on loan wisely against our known income, putting down a deposit, and can then service the repayments - are doing very nicely thank youWell done Liz for a theatrical article, "How did I end up in my sordid cul-de-sac
I missed making a smallest amount payment on a credit-card debt, an amount of about £25"When did you query your decision to buy a property that stretches you to your affordability limits What about the decision to go for an interest only mortgage and use "a huge sum each month" to "spend in a collection of ethical businesses" Could this huge monthly sum not allow you to afford a repayment mortgage
When was it ever sensible to gamble on a high danger investment opposite to build your foundations firstRisk everything when you have nothing to fall back on And all you wanted to do was build a secure futureMissing one smallest amount payment of £25 on a credit card - which could in any container have been easily avoided by setting up a direct debit - is scarcely the predictable cause of a personal debt crisis
And choosing an interest only mortgage, but then investing "plenty" of money each month in equities, is a personal choice, not a result of penuryPerhaps living in a property sufficiently modest that it doesn't earn a £500k add to in value in 18 months might be the beginning of a more sensible approach to personal moneyI think that if you have made half a million duty free before you whinge about the stamp duty) in 18 months then why are you complaining about your situation It is a huge sum and you did not earn it but got it as a result of the debt driven housing bang that you are complaining about
Extraordinary I think that you will get very small sympathy from most people, certainly not the real victims of the subprime crisis There is obviously a very good side to your character but complaining about being an overwhelming beneficiary of the housing market does you small creditNobody has forced you into money owing - you spent/borrowed the money yourself
Why don't you sell your £1m+ possessions, pay off all your debts and have a tidy figure left over I don't believe many people should have sympathy for someone sitting on more than £500k evenhandedness Another point - instead of investing extra income why not pay down your expensive to service debtsPaying somebody £10,000 to position your mortgage
Investing in the market " for the future" when you have got debts to pay that are affecting your credit rank If you need to create provision for the future, why not disburse into something a bit safer with some tax free benefits, eg ISAs, near to the ground risk pension scheme, etc
Were you truthful with your financial adviser If so, consider suing him for letting you invest rather than pay off your amount overdue Also, did you really need to move house, and pay so much trample duty The £100k trample duty is the thin edge of the wedge, as you have probably borrowed to pay this, and are paying interest on this
You require to see a debt counsellor or financial adviser asap If I was you, I would think seriously downsizing in property, or advertising up and renting or living with family or associates I have done this, swallowed my pride, but I can sleep well at night knowing I am money owing freeAm I reading this correctly
This woman has made GBP05m on her possessions and she is complaining about having trouble paying the mortgage I cannot believe that this lady feels so sorry for herself Again and again we hear this bizarre approach in the UK where people believe that owning your own home is a basic correct rather than a luxury
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