A few things about me

I watched the live transmission of Micheal Jackson’s memorial last night.  A tear almost fell.. the mango in the throat was gigantic. RIP. Al Sharpton’s speech was superb. I loved Jennifer Hudson’s performance and Lionel Richie had me wanting to attend service at Kampala Pentecostal this coming Sunday. I love love that song.

Houses.

Perhaps some of you can shed light on this. I have been comparing the house buying procedure here in Denmark to England and Uganda and find it very interesting. I am thinking that my memory may not serve me right hence the need for some clarification.

When shopping around for a house in Denmark, among the paper work you recieve is something called a “Tilstandsreport” this is a suveyor’s report about the condition of the property. Whatever he can see with his eyes (no machines are to be used) is noted down and this report is available to the buyer. It is valid for only a year.  On this report one can also see how much money the seller still owes the bank.  Big Al and I were getting really shocked because we would go see a house being sold for the equivalent of say$400,000 and on reading the report would see that the seller still owes say $300,000 and has been living there for 17 years and still has 30 years left on the mortgage yet the seller is in mid fifties or sixties. I was not understanding how that worked.

Anyway so when we were at the bank I just had to ask (that’s how one learns) and the bank guy explained it thus. In Denmark, the age of the buyer is not an issue because the house is a security. The bank will usually send out an independent valuer to the house to value the house. Because the value on the house is confirmed by this guy, the bank knows that they will get thier money bank should the buyer die hence if you are seventy and you want to buy a house at $1,000,000 and have at least 10% of the deposite they will loan you the money.  He also explained that many pensioners who have finished off paying thier mortagages also take out big loans on thier house as a source of income. So say you are 65 and your pension income is not good, but you have paid off your house, you go to the bank, get a very big loan and live off that money for the rest of your life, the bank secure in the knowledge they can also sell the house to recoup thier money. So your monthly payments on the loan are not very big.

When I compared this to England and Kenya (I may have my facts wrong so please correct me) the older you are the higher the deposite the bank will want and will offer you a shorter life span on your loan because you as the buyer are deemed a high risk. About a year ago, the bank that had fiananced the estate my mum lives in sent a representative to sell loans to folks on the estate. The loans were for folks wanting to re-do thier houses, you know things like painting, changing windows, redoing roofs etc. Mum was not approved cause she was not working at that time though the house is paid off and could have put up the house as security.

Anyways I find it interesting and would like to know if I have my facts right as regards the age of the buyer affecting the loan process in UK and Kenya.

Big Al is convicinced the main difference lies in the bank’s valuer’s presence. The fact that he goes out and ensures that the said value of the house is actually that. We are not sure if this happens in Kenya or UK and if it does then why do banks give older buyers a bit of a hard time??

Comments on: "MJ and Buying property in Denmark." (5)

  1. kenyantykoon said:

    now that mj is dead and gone i think pple should go back to living their lives. It seems thats all pple are thinking of. its is one of the most viewed topics in the web and also the piece i wrote on him is still getting a lot of traffic. I think now that he hasnt risen from the dead as some were waiting for, life will go on and the wheels of the bus will keep on turning.

    ps: dont take this the wrong way or anything(edit this out) but u should change this theme. its not mrembo:-) but maybe its just me. am very opinionated

    Noooo.. lol! I like this theme, its neat and easy ama.. which one do you suggest?

    • i don’t know…something brighter. i just think this theme doesn’t suite your topics. you talk about fashion and life stuff and other things like that. this a theme unsuited for it.

      Sorry, will not be obliging this time round cause this works for me 🙂 right now.. when the wave hits, as it usually does, I will get round to changing it.

  2. To be honest, I felt sad about MJ though I only like 1 or 2 of his songs, and was never a fan, really.I also felt a little jealous coz the world seemed to ‘stop’. Wierd…but if I died today, no one outside of my family, and close friends would give a damn. And even then, my friends would forget and quickly move on. Can’t explain the feelings though.

    On housing: Houses in the Western world are more than just walls around you and a roof over your head. It’s capital. Banks and other financial institutions in Kenya are catching up with this, albeit slowly. Most people save and buy a ka-plot, and then build moss moss, stone-by-stone, bloc-by-block.I’m considering this route. Mortgages are not too common.

    lol at the jealousy. The part about family and friends, hey that’s the reality for like 98% of the worlds population so don’t be feeling so alone. When I moved here and when we begun discussing buying a house and it was all looking impossible, I begun to think of building moss moss. So I did my research and found out in Denmark, when you buy land to build, the house has to be up and finished in 2 years otherwise the Council takes the land away. Recently there’s been a saga in the news about a guy who has taken forever to finish his house, over 3 years and the Council has now bought back the land from him and are tearing down the unfinished house. Things work so different here.

  3. I also watch the MJ memorial and thought it was amazing, especially the eulogy by Al Sharpton and the speech by Sheila Jackson, the congress woman…

    I’m a huge fan of the dude and wrote my own tribute God was kind to Michael Jackson

    With regards to the housing issue, lenders in the UK (and I suspect most lenders in developed countries), provide mortgages to individuals based on 2 things…firstly, the fact that they will have a legal charge on the title deed on the property, and secondly, that they can assess an individual and determine whether they are willing to accept the risk that they will get their money back.

    How the individual is assessed for risk varies a lot, but in most cases, its on the basis of a credit report held by an independent agency like Experion or Equifax, and this report will score you on certain criteria to assess your risk. Age does come into it, but only because you are expected to retire at a certain age and therefore, the likelihood is that you will not have a regular income at the same level you have while working.

    However, age is not a single factor that will stop a lender from providing a mortgage, and most will use the credit rating report simply for info, and then make a decision on risk based on their own judgement.

    If for example, someone has a high income and is paying into a pension, a bank can make a judgement that when retired, that person will still be able to make payments based on their projected pension. In such a case, a bank may choose to lend regardless of age, or reduce their risk by reducing the mortgage term, or refuse completely – its totally at their discretion and there is no uniform answer.

    The bottom line is that regardless of whether the person dies, the charge is still legally binding. For example, if the person’s child inherits the house after the owner dies, the deed is transfered to the inheritee (if there’s such a word), but the legal charge to the title deed that gives the mortgage lender (and subsequent lenders who choose to provide money for equity) the right to cash in on the house on sale remains intact.

    It doesn’t matter theoretically how many owners change hands, the charge has to be legally honoured to compensate the lender with the charge on your title deed. In most cases, when a house is sold, the new buyer effectively asks his lender to pay the old lender therefore the charge then moves to the new lender and the principle is the same.

    You will find that most financial institutions around the world use this model with some variations that are based around risk. Choosing to lend once you know what risk you are placing your money is entirely up to an individual institution.

    I read your post on MJ. The last paragraph got to me sana just after I have been saying, time to move on, no more mangoes for MJ.
    Haya, the info on the house, I have to read it again and again cause I am not quiet understanding the term “legal charge” which leads me to deduce that you are a lawyer. Very informative and thanks for the info. I have learned something new today or tomorrow, when I fully understand .. it’s rather late here.. hence I’m a bit slow on the uptake.

    • Mrembo…let me see if I can demystify it.

      A legal charge on a title deed is simply a notation that says that whoever has the deed owes some money lent to him or her to purchase the property that is the subject of the deed. If for any reason the property is sold, then whoever buys it has to first pay the company who have made the charge on your deed. If there’s more than one charge, they are paid up in order from the one you owe the most first. Essentially just a note saying this person owes us money.

      …And just for the record…No. I’m not a lawyer. I just taught myself how to hustle.

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