Wednesday, Jun 10, 2009
Property price falls trigger lender re-mortgage incentives
Moneymarketing: Mortgage lenders wipe thousands off borrowers' debts
GMAC-RFC is offering to wipe thousands off borrowers’ mortgage debts if they remortgage elsewhere. GMAC-RFC- which stopped lending to new customers last year - says it is piloting the move with around 300 borrowers in a bid to free up funding and also help borrowers reduce the loan to value of their mortgage to 80 per cent following falls in property prices.Former Morgan Stanley lender Advantage, which stopped lending in 2008, is understood to be offering borrowers a similar deal, although no one at Morgan Stanley was available to confirm the details at the time of writing.MoneySavingExpert.com reports that Advantage offered one borrower the chance to wipe £25,000 off their mortgage.
Posted by jack c @ 05:10 PM (668 views) Add Comment
4 Comments
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1. jack c said...
Here's a bit more on Golden Goodbye's
Borrowers paid 15% to remortgage elsewhere - Robert Thickett - 10-Jun-2009
Exact is believed to be coordinating efforts by lenders such as Morgan Stanley to pay borrowers around 15% of the cost of their mortgage to remortgage elsewhere. Mortgage Strategy understands that Exact has already sent out notices to borrowers from two loans books worth £1bn.No one at Exact was available for comment.
GMAC-RFC is also offering to reduce a borrower's debt if they remortgage elsewhere.Jeff Knight, director of marketing at GMAC-RFC says: “At the moment we are offering a pilot and have only contacted around 200 to 300 customers. We are trying to get their LTV down to about 80%. We are not targeting those with LTVs of 125%. He adds: “It will help people who want to remortgage and help free up some of our funding”
Edeus, which post administration became Exact, was the first to offer this type of deal in July 2008, which it dubbed the Golden Goodbye.
2. mark wadsworth said...
Brilliant - that's the free market in action - when lender and borrower have got each other over a barrel.
3. Strateshooter said...
I used to tell my kids to be responsible and careful with money.
I think I will now tell them...borrow as much as you possibly can..tell the bank youcan't afford to repay it..and then negotiate a reduction of debt principal.
To me..that sounds like the best and easist way for them to make money.
4. techieman said...
strateshooter ..... and if they dont they can be discharged bankrupts within a year.... something to aspire to eh!? C-r-a-z-y world.
I like these people that run up huge debts on their CCards, provide a financial statement and say they can only pay 10p a month. Exageration? well only a bit.