>>because her outgoings were greater than her incomings.

Surely if you incomings were greater than you outgoings then you wouldn't need a loan? Mind you, it isn't that unusual for banks to only lend money to people that don't need it.

Surely if you incomings were greater than you outgoings then you wouldn't need a loan?

So are you saying that if your incomings minus outgoings is, say, £1000/month and you have only ten grand in the bank, you wouldn't need a loan to buy a hundred grand house?

I think if the loan is for a one-off purchase like that, then that purchase is excluded from the calculation of outgoings.

Your net income determines whether you can afford to repay the loan. Whether you need it depends on how much cash you already have.

It's simple really. If they are working and get 10K pa then that counts as income. Money from other sources don't count towards income. It could stop or change at any time. It could even be their own money going round in circles. It just does not count.

Unless it is foreign governments they don't just give money away without being 99.9% certain they will get it plus interest back.

Sorry, Mr Mupwangle, but you're wrong and Andy's right.

Mr Petterson, you are dead wrong. Firstly, you're wrong to imply that this is an absolute rule for all banks. The staff of the Northern Bank can't even agree among themselves over it: my friend's bank manager approved the loan and was overruled by his head office. Secondly, the bank were quite happy to take into account the income my friend gets from her ex-husband, despite the fact that her kids are grown up and he is legally bound to give her nothing. It could stop or change at any time; it could be just her own money going round in circles; yet they counted it. Thirdly, a salary can stop or change at any time. For a bank to base their decisions on the assumption that it can't is pretty stupid. Finally, they didn't tell her that her outgoings were higher than her salary; they told her that her outgoings were higher than her incomings. This displays a profound ignorance of basic arithmetic and communication skills, which is what I was referring to.

And, you know, now I think about it, what would be the problem if it were her own money going round in circles? As long as she has less money at the end of each month than at the start — which she does — who cares if she moves some of it around in an odd way? If that were what she were doing, it would make sense to discount it both as income and as expenditure, but not as one and not the other.

To expand on that last point, let's say that, for cash-flow reasons, I pay my wife £100 on the 1st of each month and she pays me £100 on the 15th of each month. You reckon any bank should count that as a net £100 cost to me each month? Absurd.

>>Sorry, Mr Mupwangle, but you're wrong and Andy's right.

I often am. :-) Anyway, for some reason a loan for a large purchase didn't occur to me. Probably cos I've only ever got loans to cover debts.

"he is legally bound to give her nothing"
Minor point of pedantry: didn't you mean "he is not legally bound to give her anything". The way you wrote it has the scofflaw ex-husband sending her money in violation of his legal requirement to pay her nothing.

Sorry.

According to the laws of logic, you are absolutely correct, Rob. However, this ain't logic; it's the English language. I frolic in its myriad ambiguities.

I can think of one reason why, if I were a bank, I would value the income from employment more highly than the income received from someone who had no obligation to pay it. Yes, it's true, you could lose your job; but the fact that someone, in what is usually an arms-length arrangement, is prepared to pay you a certain amount every month for working is a good indication that others will as well, should the current arrangement come to an end. The same cannot be said for receiving an arbitrary amount for no good reason.