Nearly ten years ago a Vicar told me that 80% of the couples he married said they were cohabiting. He added that he thought 50% of the rest were not telling the truth. He was exaggerating, but had spotted a trend.

At about the same time, when I asked a Superintendent Registrar whether she thought banks and other mortgage lenders would support marriage preparation programmes, on the basis that well prepared couples should be a reduced risk, she replied, “Not at all. If there is a divorce they stand  more chance of selling two mortgages!”

If true, that seems short-sighted to me; better one mortgage with good security than two dodgy ones.

What are the facts, as we know them, ten years later?

In the UK, it must be admitted, we should look very carefully at any figures. Reports have suggested that 200,000 more single parents are claiming benefits than there are registered single parent households. Is this because 200,000 living-in boy friends do not regard themselves as parents or step fathers?

If there are lots of couples, single mothers or peripheral males who are uncertain about or unwilling to tell the truth about their marital status, it must be more difficult for mortgage lenders or benefit decision makers to make sound judgements about loans or benefits. How long do you have to be together to be ‘cohabiting’ – one night, two nights, a week, alternate fortnights, a month, or a year?

Conversely, if the lenders do not require a deposit and are willing to lend in excess of 100% of the value of a property it is surely the case that they are no less feckless.

In the United States the Equal Credit Opportunity Act of 1976:

“prohibits loan discrimination on the basis of race, color, religion, sex, marital status, age and other criteria, making it harder for lenders to identify borrowers at high risk of default. It therefore means loans are offered to people who otherwise would be denied, and lenders compensate by pushing products with high interest rates and other terms associated with predatory loans.”

“Predatory lenders ….. get some scrutiny under the Fair Housing Act of 1968. The law requires equal treatment in terms and conditions of housing opportunities and credit regardless of race, religion, color, national origin, family status, or disability.”

From answers given by nearly 15,000 people completing a pre-marital inventory we learn: the majority were ‘cohabiting”, including the already [recently] married, and some of the widowed or divorced. Just under half were ‘not cohabiting- single’. 15% already had children. 15% also were entering a marriage where one or both of them were divorced.

Nearly 50% answered that their attendance at a place of worship was ‘always’ or ‘frequent’, so it is likely that the 15,000 are not a representative sample of the population or of couples getting married. Nevertheless, we can still learn a great deal from the accumulated couple profiles – the individual reports are confidential between them and their facilitator.

Who, then, are the ‘sub prime’ borrowers? What proportion of them are couples married to each other? How is the remainder split between those in civil partnerships, cohabiting couples and LATs [Living Apart Together]? Will the mortgage lenders tell us? I rather doubt it, or rather not before a persistent financial journalist digs out the facts.

And then, of course, we really need to know about repossessions – married, civil, cohabiting and LATs.

If it is the case – when this information finally surfaces – that repossessions are tilted very much towards cohabiting couples, divorcees and single parents, it will lend weight to the argument that marital status is a very significant factor in lending; ignoring it may have cost the economies of the US and the UK dear, as well as shareholders of banks and other financial institutions.

Research has demonstrated how married men, particularly fathers, earn more [10% to 40%] and how much more wealth accumulates in the hands of the married than the unmarried. “On the verge of retirement the typical married couple had accumulated about $410,000 [or $205,000 each] compared to about $167,000 for the never-married, just under $154,000 for the divorced, about $151,000 for the widowed, and just under $96,000 for the separated.” [Waite and Gallagher – “The Case for Marriage” p112]

In the US, where the Sub-Prime lending crisis began:

“the number of never married Americans soared from 21 million in 1970 to 52 million in 2005. Cohabitation has become a substitute for marriage. Even if their son or daughter does marry the cohabiting partner, their chances of divorce are 75%. Grim odds. Of cohabiting couples, 41% have children living with them. If the couple breaks up or the ensuing marriage fails, the unmarried parent may move back into his or her parents’ home – bringing grandchildren to help raise and financially support.” [“Living Together – Myths, Risks and Answers” – Mike and Harriet McManus, 2008]

In the UK, in the Foreward to Patricia Morgan’s book, “Marriage Lite” [2000] – also about ‘cohabitation’ – Robert Whelan wrote:

“On 4 January 1994 the BBC launched the Year of the Family with a programme called The Family Show. In one section of it, the presenter Nick Ross asked childcare expert Penelope Leach for her views on the prospects for children born outside marriage, and her reply was illuminating:

‘You said born outside marriage… What’s that got to do with anything? There are no statistics whatsoever that suggest marriage -that piece of paper -makes any difference at all. What matters is relationships.’

Penelope Leach was taking the line which still remains extremely popular amongst social policy intellectuals. Whilst it had become obvious that growing up with a lone parent put a child at a disadvantage, the alternative – according to the bien-pensants -was not to advocate marriage. Rather, it was seen as more ‘inclusive’ to say that, if a child has two parents, it matters little if they are married to each other, or even if both adults are the biological parents. In 1994 Penelope Leach was right to say that there was very little, by way of statistical evidence, to prove anything about marriage vis-a-vis cohabitation, but we are now in a different situation ………….” [my italics].

Patricia Morgan continues:

“The new National Family and Parenting Institute proudly launched itself [in 1999] with the
findings of a Mori poll which showed that only one in five parents felt that being married was very important to children’s happiness (and only one in ten in the 25-44 age group: ‘suggesting that persuading people that marriage is central is preaching to the unconverted’). …….  However, preaching to the unconverted has to be distinguished from informing the ignorant…….. Public support or approval for cohabitation rest largely upon assumptions about utility that are open to confirmation or refutation on the basis of available data.”

“Overall, the median duration of a childless cohabitation is 19 months, before it leads to a birth, a marriage or terminates. By three years, three-quarters of women in the British Household Panel Study either had a birth, got married or dissolved the union. The median duration of all cohabitations involving never-married women is just under two years, and less than four per cent of cohabiting unions last ten years or more. This matches cross-sectional data from the General Household Survey, which showed that, by the time they were interviewed, over a half of female cohabitants under 60 had lived with their partner for less than two years, and only 16 per cent for more than five years.”

“Research findings published by John Haskey [formerly head of the Family Demography Unit within the Population and Demography Division of the Office for National Statistics, now Visiting Senior Research Fellow, University of Oxford] in 1992 reported that UK couples marrying in 1970-74 were 30 per cent more likely to divorce after five years if they had cohabited; those marrying in 1975-79 were 40 per cent more likely, and those marrying in 1980-84 were 50 per cent more likely. Allowing for extra time living together, previously cohabiting couples still seemed 20 per cent more likely to divorce after 15 years of marriage.”

Whilst the government and the “charities” and quangos it sets up may feel bound by the prevailing political correctness, no such inhibition should prevent the banks and mortgage lenders from pursuing business plans based upon commercial reality. Providing 25 year mortgages to couples whose unions are likely to last around two years seems like very bad business.

At present, it looks as if government and commercial interests, are colluding in the suppression of information about cohabitation: as Harry Benson writes in his paper [“The conflation of marriage and cohabitation in government statistics – a denial of difference rendered untenable by an analysis of outcomes” 2006]:

“Despite a great deal of evidence that marriage benefits and protects adults and children, successive UK governments have eroded and dismantled policy mechanisms that distinguish married from unmarried cohabiting families. Following the abolition of the term “marital status” in 2003, recent government-sponsored family research refers only to “couple parent families”. This combined category conceals significant differences between unmarried and married couple outcomes typically demonstrated by overseas and earlier UK research.”

If it turns out, as more facts are known, that it is the banks and mortgage lenders who created their own crisis, when there was enough evidence staring them in the face about the consequences of pursuing their ‘business models’, more heads should roll. Shareholders can deal with the directors; electors will have to find more enlightened politicians. Maybe, the clergy will redouble their efforts to provide effective marriage preparation.

But what will local authorities do about marriage preparation for couples having civil weddings – now that registrars are their employees? This remains an open question. Most LAs are committed through Local Area Agreements [LAAs] to delivering a net increase in housing provision [National Indicator 154]. Are these houses really required so that mortgage providers can make more bad loans? If family breakdown is reduced [no National Indicator for that!] many benefits would ensue. Local Authorities need to revisit their priorities, as well as the financial institutions.

Nick Gulliford – August 2008

Quel Bec

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“Nick Gulliford works with Affinities [] which helps people learn more about themselves and their relationships through research-based psychometric inventories and interactive learning. He stresses the importance of healthy marriages and relationships and proposes some reforms to the process of registering births and marriages

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