Friday, November 15, 2013

New policies

This blog is not for public consumption albeit it is public.  But I do not write here for the benefit of others but to record thoughts over time.  Most of my blog entries are focused on issues I see throughout the day or think about during the night when insomnia kicks in.

I have also got a blog entitled 'would the world be better if' where I record some ideas about 'policies' or things that if implemented might make a change.

I have added two further ones today which I will also cover here

The first is rental and the second is loans.  Both of these cover a set of real experiences I have had.

New legislation should be put in to cover the following

1) If a person is renting a property and has a deposit in deposit protection scheme then the deposit should be deemed to be ok for a new property rental if the tenant wants to move.  This would negate the trapping of tenants into rents which they cannot get out of due to not having deposit money for a new property.  This occurs due to the return of deposits from an old rental agreement taking time (even when done under the new agreement) and new rental agreements needing deposits prior to moving in.
2) Understand the risk that the old deposit may get used to cover issues in the old property it would put the condition that any short falls in deposits caused by these events would be made up or the rental agreement (new) terminated.
3) landlords are not allowed to demand more than normal rent up front.  I.e. you only can ask for the month ahead (as per normal payments) not 2 or 3 months rent in advance.

This should help a lot of people without any major inconvenience to anyone in the market

This is a real problem I have experienced and a friend has experienced.  The banking sector is in such a mess that stupid decisions are being made along the lines of:

a) Person has a debt of x at percentage interest % very high
b) Person x goes to the bank and shows that they have been making repayments in full on time
c) Person x asks bank to take out a loan to reduce the cost of debt advertised at 2/3rds % very high
d) Bank says no, you cannot afford a loan at that rate and you must stay with your more expensive debt

This has happened now both scenarios where the new loan request is with both a new bank and with the old bank holding the current expensive debt.

So, new law.

If a person with debt of any form who can demonstrate a good repayment history comes to any organisation offering a loan of any form at a lower % rate then it will be illegal to refuse that debt on the grounds of affordability.

I.e. if a you have a loan of £10,000 at 17% and the bank offers loans at 12% for the same amount that bank cannot refuse you the cheaper loan.  This should apply to mortgages, loans, credit cards etc.  
The only condition is that the loan is used to shut down the old loan and not as well as.


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