Sunday 22 February 2009

Mortgages of 100% "Were Foolish"

Lord Myners tells us it was "foolish" for banks to offer 100% mortgages.

I haven't had to take out a mortgage in the last six years, so I haven't paid any attention to what seems to have been a pretty chaotic time for both lenders and customers in the mortgage markets.

I imagine the long and the short of it going down something like this:

Bank Manager: We'd be delighted to offer you a 100% interest-only mortgage, sir.
Customer: Excellent! So do we need to pay a fee or some kind of indemnity?
BM: No, no. It's fine. Just sign here and here.
C: But there is some kind of charge, right?
BM: You'll need to have a conveyancing solicitor carry out the standard searches.
C: Sure, but what do you guys get out of it?
BM: Another satisfied customer!
C: Right. But if I were to stop paying my mortgage.... what then?
BM: Well, we all hope that never happens, but if it were to, then we'd be forced to repossess your property.
C: The property you're offering a 100% interest-only mortgage on?
BM: Yes.
C: So if we stop paying our mortgage, you'll effectively just take back the property you've paid for on our behalf?
BM: Essentially, yes.
C: Where do I sign?

Now I know it isn't quite so straight forward as I make out, and that there are penalties for defaulting, but the above isn't a million miles away from the truth. The last time I had to get a mortgage I had to pay a deposit, prove my earnings, swear my devotion to Xenu and join a cult.* If I go into arrears I'll be forced to drink the Kool-Aid.

What the hell kind of business model was being followed giving people 100% interest-only mortgages? People taking up these offers had less to lose than if they were renting - at least then there would have been the threat of losing a deposit. I understand not everyone can afford the deposit on a house, but that doesn't mean you should just rewrite the rules so everyone suddenly can. I guess the current state of the global economy mirrors the durability of said business models.

*The author is not a follower of Scientology, nor any religion and respects the rights of others to worship freely. Nor is he suggesting Scientology or any other religion is a cult, or that Scientology or any other cult would necessarily encourage or demand its members to commit ritual suicide.



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Thursday 19 February 2009

Qatada

Today the BBC reported that Jacqui Smith, the British Home Secretary is "very disappointed" that the European Court of Human Rights has awarded compensation to radical Islamic preacher Abu Qatada.

The Shadow Security Minister Crispin Blunt also went on record echoing Mrs. Smith's consternation and also seized the opportunity to criticise the government, calling the decision "an appalling scandal... ...[that] will horrify most reasonable people in the UK." He went on to say "It shows just how incompetent the government has been at managing the problem of preachers of hate and, frankly, it makes a mockery of the concept of human rights if we can't protect ourselves against people who are out to destroy our society."

Qatada was arrested in South London in October 2002 having been on the run from authorities since December 2001, when new anti-terrorism laws were passed in the wake of 9/11. He has been detained at Belmarsh Prison, Long Lartin Jail and under a Control Order, or strict house arrest since. Albeit a £800k house.*

Qatada arrived in Britain with his wife and kids using a fake passport back in 1993 and claimed asylum, which was granted the following year. Since then the authorities have been all over him like flies on shit. And not without good reason. He has been linked to various unsavoury deeds and people including:
*Praising attacks on Americans and the killing of Jews.
*Alleged association with Richard Reid, the infamous 'shoe bomber'.
*Being found in possession of £170,000 in cash, including £805 in an envelope marked "For the mujahedin in Chechnya".
*Issuing a fatwa justifying the killing of converts from Islam in Algeria.

The problem the authorities have with the above objectionable acts is that none of them are technically illegal according to the letter of the law, or at least weren't, before the new anti-terror laws came into effect. This poses a huge problem. Police have historically flexed their muscle to persuade wrongdoers to correct their wayward actions. They've done it to me (with little success) and to my friends. The theory is based on a universal respect for the law (and the enforcers thereof) and the other civilians we share the planet with. For most of us law-abiding, tax-paying citizens this is just fine. But what happens when your beliefs contradict the law of the land? At the bottom end of the scale is the young person paying their own way through university, studying hard all day, working a part time job at night and smoking a little weed when the opportunity arises. This is illegal. But surely working toward your degree (whilst paying tax) so you can better yourself and be somebody and make a positive contribution to society one day offsets this minor infraction?

Because of this, the Judges sitting in the European Court of Human Rights ruled that his six-year detention without trial breached his human rights. Jacqui Smith stated that the now-withdrawn measures had been devised in "good faith" to protect the general public, which I wholeheartedly believe.

I am not bleeding-heart liberal. I may have a leaning toward the left wing, but I also agree with parts of the right's manifesto. For instance, I believe in the right to a fair trial by jury, and food, clothes and shelter for all, regardless of how willing they may or may not be to contribute to the greater good. However, I also believe that I should have the right to keep a handgun in my home to better enable me to protect my property and loved ones. If we, the British people, are expected to live by a certain set of laws, then they should apply to every one of us, regardless of whether you were born here, or how you came to be a British citizen, regardless of any poor asylum decisions (it was a different world back then).

The European Court of Human Rights is merely upholding the law that guarantees us all basic civil liberties. You cannot persecute human beings without a fair trial. To do so would make us no better than those we judge to be "enemies of the free world."

The sums awarded in this most recent case are nominal at most. Abu Qatada himself was given £2,500 in compensation for over six years of incarceration and restriction of freedom. That works out at approximately £1 a day.

Everyone 'knows' what's going on, but no-one seems able to prove it. No-one can pin a conviction on him. And until they can, they're going to have a hell of a hard time justifying keeping him behind bars.

This post is riddled with poor evidence and hearsay, which is mainly due to the fact that there is nothing in the public domain that incriminates him as far as I can tell.





*Where the hell do you get £800k council houses?