New council could offer mortgages
Saturday 21st February 2009, 12:00PM GMT.
Mortgages could be offered by Shropshire’s new council in a bid to help kick-start the county’s ailing housing market.
The move is designed to help people unable to get mortgages from traditional lenders and who are finding it almost impossible to get a foot on the property ladder.
The proposal has come from Councillor Alan Mosley, Shropshire County Council Labour group leader, and will be put to Friday’s meeting of the authority in a formal motion.
He is calling for a report on whether mortgage lending and other housing initiatives are feasible to be presented to the council task force which has been set up to find ways of helping Shropshire families and businesses through the economic crisis.
The standing committee of nine county councillors has already been ordered to review the support provided by the authority and other agencies and to decide what additional services can be provided to lessen the impact of the deepening recession.
Councillor Mosley says in the motion that the Government had announced it would lift restrictions preventing councils from building more homes, possibly by allowing them to set up construction companies or providing short-term finance for stalled public-private sector building programmes.
He said today: “I do think the Government is showing real intent to change the rules for us to provide much needed housing.
“Housing is a key priority for the new council and I expect the motion to go through with strong support.”
He added that he believed easing restrictions on authorities offering loans would be of great benefit in stimulating the housing market and aiding those struggling to move on to the property ladder.
He said: “Hence we request that officers investigate the potential for adopting such initiatives in Shropshire and that they then report to the standing committee on the economic recession, for them to make recommendations to the implementation executive.”
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I’m sure the idea is well-intended, but this is not really the sort of thing that any council should really be considering. I can’t think of anything worse in fact than a council administering something like this. And presumably they’d want to take on dozens more staff (paid for by us of course) to run such a scheme.
Bad idea. They should concentrate on doing what they are SUPPOSED to be doing – and do it better.
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They are a council NOT a bank. Why should they be lending OUR money to people to buy houses. Use the money to BUILD houses. If borrowers were to default on payments we could have another sub-prime fiasco. Hope this gets voted down!
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believe this when it happens……….. it probably wont knowing our council!!!!
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what a terrible idea if they want to kickstart the economy stop meddling with initiatives and cut council tax, thats what we want less council and less tax
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IF THEY DEFAULT ON THEIR PAYMENTS THE COUNCIL COULD CHUCK THEM OUT, MORE COUNCIL HOUSES WOULD THEN BE HAD, AS THE HOUSE WOULD THEN BELONG TO THE COUNCIL, MAYBE THATS THE PLOY?
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Their main priority should be to try and do the job, that they are paid FAR TOO MUCH money for, correctly and efficiently, before meddling in something that they know even less about than running Shropshire.
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how typical of this loony lefty labour loon to come up with an idea which is insane
if the council has money to spare, cut our taxes
lets get these do gooding liberals out of power asap
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the council should try putting its own ‘house’ in order first, enough higher paid people already creaming it off, dont give another excuse to them to increase their salaries and expenses, most people didnt want one council.
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insane idea will bankrupt us all further still
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I don’t think this is a new idea. Back in the ’60s and ’70s councils used to offer mortgages to people as I recall.
I’m not convinced that they should be looking to lend public money to any high-risk investors, but in some cases, especially say long-term reliable tenants wishing to take a first step on the property ladder, it could represent a good scheme, with the double benefit of freeing up rented housing and allowing a financial return for council tax payers.
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Great idea – get the Council to run a bank and Northern Rock to run the locals services? hmmmm?
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Lucy W – I would rather let yourself run our services for us than Northern Rock
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Peter: If these tennants are reliable and long-term, they should go and get their own mortgage. Isn’t it enough that these people get to buy their council houses at a heavily discounted rate at the expense of the rest of us? Honestly *tut*
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I’m willing to bet all the people commenting on this who are against the proposal are well established property owners. Spare a thought for those of us who need in excess of a £20,000 deposit before a bank would even consider us for a mortgage. I’m happy for you guys who only needed a couple of grand in the 70s and 80s but typically, if it doesn’t benefit you, you’re not interested. Any help is welcome and any defaulted mortgages will put another property in the councils hands for those who need it.
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Lucy,
Honestly – read what I said – ‘tut’.
I didn’t mention buying council housing at all. I simply meant people who could offer a record of a proven history as a tenant, either private or council, but who wished to take a first step into private house purchase. In times when mortgage lending is hard to find a council mortgage might be a valuable addition to the market and stimulus to the economy. That’s exactly what was done in the ’70s at one point.
I think one of the worst things that the Tories did in the ’80s was to sell off the council housing stock and not allow the money to be spent on replenishing it. How short-sighted and damaging a policy was that?!
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Peter, ok, but I though that you were aware that there has been a lot of deregulation and the draconian days when you had to go down on bended knees for a martgage are gone – hence there is no need for the council to get involved with good risks that you describe.
Re selling off the council stock, the money sorted out the National Debt that the previous Labour administration has left and the social housing stock was in fact replenished by the new houseing trusts and associations that came into being. I am confident that you will find that most tenannts would prefer to be with a new trust or association than the council.
The only damaging thing with the discounts was it encouraged people into home ownership who were not suited to it, but that is all in the past now.
What are Labour doing about the housing shortage? I’ll tell you – nothing. Why? I’ll tell you – it helps house price inflation so we all borrow more against our assets and we all feel good and keep voting in the clowns back in.
Thats the trouble with democracy – people vote on how they feel on the day, not how tey may feel in years to come.
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now that northern rock has repaid 3/4 of its debt to the taxpayers and are offering up to 90% mortgages, it is time to merge them with the post office so that we can have a genuine peoples bank.
councils should stick to what they know best, wasting ratepayers money and hiking up council tax
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Bring on the revolution and remove all the inept parasites that run our medicre country!
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Devon: I quite agree, Councils should stick to what they know best, but what exactly do they know best? hmmm?
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yawn!!!!!!!!!!!!!!!!!!!!! it seems our council knows nothing……… well the proof’s in this new unwanted theatre we have in shrewsbury and the darwin monument at the top of mardol. plus its seems our “beloved” councillors waste their time on stupid protests about phone masts in shrewsbury which clearly didnt have any effect as vodaphone are going ahead with it.
unitary council or not we are all doomed!!!!
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a loony left idea which no one would want the council to get involved in, we’ve had the bad old days of councils runnning houses in the 80′s, thank god maggie god rid of that god bless her, lets not have them owning houses indirectly again through the backdoor, support the private sector, private banking and home ownership in private hands
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