There’s no doubt that mortgages are easier than ever to obtain, and for massive amounts of money too. Sure, the size of mortgages available reflect the almost ludicrous rise in the cost of houses, but I do feel that some lenders are simply offering too much money - when we got our first mortgage, the lender was only offering up to 2.5 times our combined annual salary. Nowadays, I’ve heard of anything up to 5 times being offered, and that’s just too much - even a small rise in interest rates could leave you unable to pay it back. Obviously a useful tool in working out how much you can afford to borrow is a mortgage calculator, and it’s worth a look to give you some idea. Never be afraid to change lenders either-we have twice now, and saved a lot of money in the process.
The same applies to secured loans, which are again promoted near constantly on TV - these loans offer huge sums of money, and illustrate glowing lifestyles with happy families in their newly extended house, with the new car outside, ready to take them on their foreign holiday. What they don’t show is everything being re-possessed a year later, and the family left homeless. The level of borrowing is reaching irresponsible levels, and you wonder where it will end… The bottom line is, never borrow more than you can afford to pay back-only then should you take one of these loans.
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