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We are from the council and want to give you money

Councils want power to offer competitive mortgages

In a letter published in today's Times, Council chiefs argue that the public sector should be able to help first-time buyers and those unable to secure a home loan.

"Councils are already supporting much needed community facilities, including rescuing local post offices from closure and investing in the retail and transport infrastructure. Allowing local government to carefully intervene and support homeowners is a sensible step which we urge ministers to consider seriously."

...Critics believe that the move could lead to higher council tax if borrowers defaulted.

A bunch of amateurs providing mortgages to those who can't get them elsewhere for political and social engineering reasons, where do I invest? Oh sorry, I forgot, I don't have the choice, they want to mulct the money for the scheme from the taxpayer with the force of the State backing them.

Comments

It appears the Western Isles Council BCCI fiasco of 1991 has been forgotten. As I recall, the finance department were playing the money markets with council funds in a cunning plan to make money as described here:

http://findarticles.com/p/articles/mi_qn4156/is_20010708/ai_n13960515.

Unfortunately, BCCI went belly up and the council lost £24 million or so.

These people are just morons. The two main reasons for wannabe first time buyers being unable to make their first purchase are: (i) house prices are artificially high having been "bubbled" by over generous lending practices and (ii) they do not earn enough to be able to make the repayments. These are linked in many instances because a much-needed deflation of the price bubble will allow many to afford to buy.

Local councils writing blank cheques with other people's money will simply maintain the bubble without doing anything to address the second problem. The result is obvious: repossessions, financial losses and increased council tax bills thereby tipping more people over the edge.

Morons. Utter morons.

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