[Closed] mortgage equity investment for monthly income - anyone know anything....?

You need to look at the ROI figures, for an income of 500+ a month how much equity do you think you'd need to invest? 😀

What with the shenannigans that RBS (and no doubt others) got up to, running profitable businesses into the ground and stripping their assets, and the stuff about mortgages/investments/etc. highlighted in [url= https://en.wikipedia.org/wiki/The_Big_Short_(film) ]The Big Short[/url], I'd tell that company, in no uncertain terms, to **** off. And when they get there to **** off again. To keep ****ing off until they went full circle and ended up back with you. So you could tell them to **** off again.

...he seemed to have an answer for everything.

That's what sales people do...

Sounds "[i]Towtally abav bawd mate[/i]"

If it is too good to be true...

what is he on about?

Sounds like he wants to lend you money against your property but instead of you getting the cash he invests it for you? Presumably he then takes his cut before you get your return. No doubt you take all the risk and he will want a second charge on your home for when it goes tits up?

Weird.

So you are going to get an additional income of >£6000 pa, and also pay your mortgage off in half the time you would otherwise? I suspect the investment will be in magic beans and snake oil, which are both on the up at the moment. Where do I sign up?

so you're thinking of securing a loan on your house to a cold caller over the phone?

The mind boggles...

I'd start looking for somewhere under a bridge to sleep when it all goes tits up.

A quick calc says that assuming a return of 6% you'd need an investment of over 100k to give you that sort of return but that doesn't factor in the interest you'd be paying on the additional 100k. Quick question, how much would your mortgage go up if you were to add 100k onto it?

Using an investment to repay a mortgage isn't necessarily a bad idea but investing in something that someone cold calls you about almost always is.

Using an investment to repay a mortgage isn't necessarily a bad idea

tell that to the millions with under performing endowment mortgages!

but investing in something that someone cold calls you about almost always is.

It's utterly insane.

99% chance it's just a scam and he'll fleece you. 1% chance it's just a shit investment and all your profit goes in charges. 0% chance it's actually a good idea.

It's basically them purchasing a percentage of your home and paying it out to you monthly. All the cards are stacked in their favour and you will end up out of pocket. It used to be an advance on the property at current valuation then interest charged on it until you sold it, in which time it will have grown to way beyond your initial payment. Mugs game, praying on the desperate.

tell that to the millions with under performing endowment mortgages!

Most of them got bad advice and weren't fully aware of the risks. Doesn't make it a bad thing to do, just more expensive than people thought. That said I worked a summer in an insurance company in the early 90s when all this started to come to a head and I decided then that I'd never take out one of those mortgages.

It's utterly insane

I was trying to be kind.

curto80 - Member

what is he on about?

Sounds like he wants to lend you money against your property but instead of you getting the cash he invests it for you? Presumably he then takes his cut before you get your return. No doubt you take all the risk and he will want a second charge on your home for when it goes tits up?

To be honest I wasn't quite sure. The more I think about it, the more it sounds like some kind of equity release thing, or you invest part of your house in some 'sure fire' thing. Dunno. The numbers he was quoting did sound a bit bonkers - £6k/yr return & pay off your mortgage early. Why isn't everyone doing this?!

TomB - Member

So you are going to get an additional income of >£6000 pa, and also pay your mortgage off in half the time you would otherwise? I suspect the investment will be in magic beans and snake oil, which are both on the up at the moment. Where do I sign up?

Hmmm, yes. Quite. The funny thing is as I was writing my original post I was thinking to myself 'why didn't I just hang up the phone?'.....

footflaps - Member

so you're thinking of securing a load on your house to a cold caller over the phone?

The mind boggles...

I'd start looking for somewhere under a bridge to sleep when it all goes tits up.

Erm. No. I was thinking of asking if anyone else had heard about this on here & seeing what kind of nonsense it actually is.
I hadn't heard of it and a quick Google didn't bring anything up (which also got my alarm bells ringing) but there's always someone on here who knows about virtually any question, so I figured it was worth a post.

I have very little knowledge of financial investments & wanted to know if this was indeed as it sounds; a load of old nonsense that will leave me destitute & living out of a carrier bag, or whether it was a fairly common, legitimate practice. While I suspected it was dodgy as ****, I wanted a little more to go on, than 'sounds a bit dodgy, mate....'

gonefishin - Member

A quick calc says that assuming a return of 6% you'd need an investment of over 100k to give you that sort of return but that doesn't factor in the interest you'd be paying on the additional 100k. Quick question, how much would your mortgage go up if you were to add 100k onto it?

Using an investment to repay a mortgage isn't necessarily a bad idea but investing in something that someone cold calls you about almost always is.

Yep. Aside from the halving of mortgage repayments, the return on investment sounded too good to be true for it to be legitimate & not be a commonly known of and approved way of doing things.
If he'd have just said 'it will give you X income' or 'it will half the time you need to pay your mortgage off' then I would have perhaps thought it was feasible. But both of them......!
That was why I asked him what the risk was.....and he said 'there's no risk'.....admittedly with a slight hesitation.

craigxxl - Member

It's basically them purchasing a percentage of your home and paying it out to you monthly. All the cards are stacked in their favour and you will end up out of pocket. It used to be an advance on the property at current valuation then interest charged on it until you sold it, in which time it will have grown to way beyond your initial payment. Mugs game, praying on the desperate.

See - this is what I was actually after (although all other 'your delusional if you think this is genuine' type posts were gratefully received).
An explanation as to what the 'investment' actually is.

Like I say, I know nothing about financial services. That explanation makes sense & is along the lines of what I thought it must be.

Cheers for confirming my suspicions all....!

I have very little knowledge of financial investments & wanted to know if this was indeed as it sounds; a load of old nonsense that will leave me destitute & living out of a carrier bag, or whether it was a fairly common, legitimate practice. While I suspected it was dodgy as ****, I wanted a little more to go on, than 'sounds a bit dodgy, mate....'

Fair enough.

Let me give you some financial advice for free then.

Never, [b]ever[/b], take unsolicited financial offers; esp over the phone. They're out to fleece the gullible / financially illiterate. You could easily end up homeless.

The simple rule of thumb - if someone is cold calling, its because they are trying to get rich, not to make you rich.

The whole industry plays on seduction and the fear of missing out.

Ignore them, be rude, hang up. Don't even give them an inch.

For reference watch the penny shares scene in wolf of wall street to see what financial cold callers think of their "marks".

Then go and look at the mis-selling scandal that is equity release sold to pensioners.

Not too difficult to get a return better then mortgage rate over the long-term - that's what I do - but depends on attitude to risk as to how much to commit. I wouldn't involve someone else as they'll want their cut but building up sensible unit trusts in an ISA isn't the most difficult thing.

mudshark - Member

Not too difficult to get a return better then mortgage rate over the long-term - that's what I do - but depends on attitude to risk as to how much to commit. I wouldn't involve someone else as they'll want their cut but building up sensible unit trusts in an ISA isn't the most difficult thing.

See - that's my problem. I've got no idea what that means in a real sense. I recognise it as 'investment speak' of some kind & it sounds like you know what you are on about. But when people start talking about unit trust/bonds, capitalising negative equity gains and leveraging the pound blah blah......my brain just goes all 'meh'.......

I guess the 'if it sounds to good to be true, it generally is...' thing still holds true.

There's one born every minute!

That's got "Ponzi Scheme" written all over it, in massive flashing neon lights.

I've just been cold called

report him to the Financial Conduct Authority

he'll be offshore so effectively untouchable....

Using an investment to repay a mortgage isn't necessarily a bad idea but investing in something that someone cold calls you about almost always is.
+1

I haven't done it myself, but 'Social Lending' looks worthwhile investigating. No investment speak mumbo jumbo, just a return %, length of payback, risk etc.

[img] [/img]

I'd be more bothered about where the F he got my number from.
If I were on some suckers list I'd change my number

footflaps - Member

he'll be offshore so effectively untouchable....

His area code reckons the Leighton Buzzard area......

mrchrispy - Member

I'd be more bothered about where the F he got my number from.
If I were on some suckers list I'd change my number

God knows. Perhaps from when TalkTalk got hacked for all I know....

Geographical numbers are cheap and easy to get hold of - never buy anything over the phone that you hadn't originally initiated! I've seen some horrific sales guys rinse people who I'd say are very sensible normally.

There some fun to be had here.

String the 8stard along.

Tell him about the house you're about to inherit and can you do the same on your wife's old flat she is renting out etc ....

With any luck he'll go out and buy some flashy suit and poucy watches on his credit card on the comm he THINKS he'll be getting off you.

alexxx - Member

Geographical numbers are cheap and easy to get hold of - never buy anything over the phone that you hadn't originally initiated! I've seen some horrific sales guys rinse people who I'd say are very sensible normally.

No. He must be UK based as he talked about arranging an appointment to come round & discuss it further......not that this means it is in anyway a good thing.....
This was partly the reason for this post. I wanted to get some idea of what it actually was he was offering, whether it be scam-tastic or not so when he calls back I can go at him with a bit of ammo about why I won't be interested.

Ro5ey - Member

There some fun to be had here.

String the 8stard along.

Nah. Fine with someone calling from 'Microsoft' but I just want this bloke to stop hassling me, so the less antagonising the better; tempting as it is....

If it's a Ponzi scheme, as I suspect it is, he'll have answers to everything but most of them will be outright lies. Hallmarks of a Ponzi are:

* Unrealistically high return (income [b]and[/b] paying off the mortgage)
* Promises of no risk ("...all insured & above board...")
* The investment is in something that doesn't have an accessible market. Recent ones I've seen are shipping containers and parking spaces.
* There's usually also a promise that you can get out at any time. In practice they'll put a huge number of barriers in the way of doing so or simply ignore you.

And the thing with these schemes is that for a while, they do appear to be working. You get paid the amount promised..... until the company disappears along with the rest of the cash. It goes something like this:

* A promise of let's say 12% pa to make the numbers easy
* You take a secured loan for £100k and give them the cash to "invest"
* They start giving you £1k per month
* You think "awesome" because you're making so much profit
* They will encourage you to invest more, and to get your friends & family to do likewise
* A year down the line they disappear
* The £12k you received during the year was not from any investment, it was from your original £100k
* The other £88k is now on a permanent visit to the Bahamas

As someone else mentioned, the company will be registered overseas (even if the bloke is here in the UK) and you will have absolutely zero chance of getting the money back.

He rang back to see if I wanted to arrange an appointment to go through this awesome investment.

I said no, thanks for his time but it wasn't for me.

He was a bit less cagey & started to explain a bit more to try & get me onboard.

It seemed to basically revolve around investing in holiday properties abroad that are currently being built. So don't know if it's a scam or a timeshare or what, but I suspect that this is why he was so cagey initially because of the connotations of timeshare.

Either way - I said I was sorry if I've wasted his time but I wouldn't be interested in anything to do with what he was offering & off he went. He sounded quite gutted....

I told the wife I've signed us up for a beach villa in Bali & a condo in Florida. She hasn't replied yet..... 😆

What was the company's name?

So don't know if it's a scam

Almost certainly or at best a very very poor investment.

Either way you end up seriously out of pocket and he walks away with your money (either as cash or via a commission on the shit deal he conned you into buying).

These people are vermin.

matt_outandabout - Member
If it is too good to be true...

^^ The only advice needed on this OP.

suburbanreuben - Member

What was the company's name?

If you Google the words

Future
+
Security
+
Investments

in that general kind of order, you might find a basic website with some pics of white houses on golden beaches....that'll be it.

Well done avoiding it, I really can't believe any salesperson can actually sell this sort of product. Unless they believe their own sales patter. Sad really as the vulnerable get stuffed.