Is the credit crunch true?

[dandysmom]

Things are in bad shape here in the State also as I'm sure you know; careless lending to people who couldn't really afford the rates when they went up, etc. I'm not personally affected as my mortgage is paid off; and the drop in real estate value doesn't bother me as I have no plans to sell; it was just paper profit anyway. Foreclosures are way up, a good time to be a buyer....

I'm more concerned about the rising costs of food as Angie mentioned. Two small examples just from today's shopping: blueberry muffin up to $1.45 from $1.35 (flour and transportation costs), one large Granny Smith apple .... $1.18 (transport) !!

Charlie, it's always tight I think in the first years of a mortgage....that's when I learned a lot of low-cost peasant style recipes! Loads of pasta dishes, rice and beans, Chinese stir fries! Hang in there...

[Donna]

Originally Posted by charliebubs

I think there is definitely a crisis of sorts, but I do agree that the press are scaremongering.

I have certainly seen a lot of redundancies (sp!) in my area of work - both in residential and commercial property law - as there just isn't the work at the moment. The market has dried up and there are even estate agencies closing in my area.

Personally, I have also felt the pinch as well. I only bought this house last year, as you know, and I live on my own. With the cost of all utilities rising and my now large mortgage I have been left with a tight monthly budget. I'm just relieved that I have a lodger at the moment - as her rent really helps me out.

I would say its true. My Estate Agency company is closing branches one by once since January .. the last time being today in Kent I am lucky to still be hanging on but there are NO BUYERS so we are really struggling. My food and petrol and utilities are much higher than six months ago. I am struggling and I dont have much debt.

There is definately a crisis.

[Kazz]

But doyou think the crisis has been caused by irresponsible lending previously...or.....

[Donna]

Irresponsible lending, stupid people borrowing too much ... it has to stop somewhere!

[yola]

Hopefully this will make people see sense. The greed of the majority is frightening . . . almost a case of I want so I will buy and stuff the consequences.

I'm guilty of that too. We have a huge mortgage which has been largely driven by supporting our business. However, I do like nice things too - but my car is my only real indulgence.

However, I've now cut right back and am actually managing to pay cards and loans off.

Thankfully at the moment, being a business-to-business company we're not being hit by the retail/housing slow down - quite the oposite; long may it last! But my brother who runs an on-line eco store is suffering

[bobbie3917]

i agree with Angie
its the price of food and the utilities that is worring me,
my Gas a few years ago when my kids were young and i had the heating on a lot was only about 4/8 (Summer/winter) per week, i have just had a bill and cos i pay on the card it has just gone up to 16 per week all year (so that means in the winter i am using more then 16 per week) its about the same with electric

FOOD well i have only noticed that cos im always skint, i bring home the same money as i did last year and a little bit more than i did the year before, and i dont spend my money on crap i dont often go out, my money is mostly food and bills, and well i must be spending about 30% more on food for the same amount, and i dont by a lot of prepacked stuff, fruit, veg, meat and fish

as long as i can feed the kids and pay the rent then i dont mind missing out on nice things

sorry for going on

[Soupie]

Sorry yes it is and it has been on its way for a long time - from an insider point of view we have been aware of the decline for two years and I predicted the house price drop to the month ......

Actually I don't think the media are talking it up but then I see the effects of it every day in my job and there are a lot of people who are going to be in serious trouble if it continues.

The main problem is the rising costs of food, bills, council tax, national insurance, scrapping the 10% tax, petrol all at the same time as the credit crunch - if the government doesn't look at some way of easing the burden we will be heading for a recession in my opinion ....

true cost of inflation this year? wel last year it was 8% but I suspect it would be over 10% this year and what do we all get as cost of living pay rises? most of us only 2 or 3%

[charliebubs]

Originally Posted by dandysmom

Charlie, it's always tight I think in the first years of a mortgage....that's when I learned a lot of low-cost peasant style recipes! Loads of pasta dishes, rice and beans, Chinese stir fries! Hang in there...

Thanks Eileen - I'm hanging on!!! I do shop on a budget now too - I take my budget in cash and leave my cards at home and have to add up as I go around It's frustrating, but I have proved that I can do it - lots of pasta and rice as you say.......and jacket potatoes!!!

Originally Posted by Donna

I would say its true. My Estate Agency company is closing branches one by once since January .. the last time being today in Kent I am lucky to still be hanging on but there are NO BUYERS so we are really struggling. My food and petrol and utilities are much higher than six months ago. I am struggling and I dont have much debt.

There is definately a crisis.

I agree Donna - I don't have much debt - but I am struggling more than ever now. I must admit that previously I would have put things on credit cards and worried about them later - but I have cut up my cards now and really trying to be sensible.

It's hard - but I don't want this thread to turn into my sob story!!!! lol

Plus - before anyone worries and/or comments - the cats come first - I'll happily eat beans on toast so that they can carry on with their nice food and luxuries!!!! They have me wrapped around their little paws!!! lol

[Donna]

I have a credit card but it is only for emergencies.. ie my glasses I needed to buy last year and animal vet bills. I dont use it normally and only have a little bit on there to pay, which will be finished in a couple of months. Other than that the only thing I have is a mortgage.

I wish they had made it harder to borrow in the first place and then we wouldnt be where we are today.

[dandysmom]

Originally Posted by Donna

I have a credit card but it is only for emergencies.. ie my glasses I needed to buy last year and animal vet bills. I dont use it normally and only have a little bit on there to pay, which will be finished in a couple of months. Other than that the only thing I have is a mortgage.

I wish they had made it harder to borrow in the first place and then we wouldnt be where we are today.

So true, Donna! There was a recent article about how the credit card companies are pushing cards on college campuses: students are not only graduating with a huge load of student loan debt but enormous credit card balances.... some as high as $20,000!!
Appalling, isn't it?