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House Price Crash Forum

Aud

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  1. hi board, long time lurker I could not believe this, he has spend 180k yet has nothing to show for it and walks away scot free. http://boards.fool.co.uk/Message.asp?mid=10255269
  2. Nice saying I heard, "the optimist designed the aeroplane, the pessimist the parachute" we need to considered both positive and negative outcomes when making decisions. Too many people I know are so sure everythings going to turn up roses that they are willing to take on huge financial risks without even considering it so.
  3. Found this on the Fools PMT board. http://www.sundayherald.com/54614
  4. Hi also see Motley fool debt board! (Interesting about house prices in Lincoln too) "Hi - I did post on here before but cant find my original post - I had few responses but need to expand on the facts... we have a 4 bed end terraced house - valued at £186,000 in 2004 by our second mortgage company and has been on the market since August and now reduced to £150,000 from £164,000. It wont sell - in Lincoln there is such a glut in 4 bed properties for sale the market is stagnant and we are up against 4 bed detached houses with drive and garage even at the latest price. We owe in total on credit cards and ccj and overdrafts £39,000 - mostly spent on renovating the house which we bought 3 years ago for £90,000. We have 2 mortgages - one with GMAC for 78,000 inc redemption penalty and one with future mortages for 58,000 inc redemption. We are 2 months behind with 2 mortgage with future and have been told they are starting repossession proceedings on 1st March. We have filled in Bankruptcy papers and are filing at the end of the month when we have enough money as it costs £940 for a joint application. We have accepted that we are going to rent somewhere modest for 3 years after this but feel like we are between a rock and a hard place at the moment as our children both have important exams coming up in May and our gut feeling is to get out now - rent somewhere and get settled for their sakes - then go bankrupt and hand the keys over to the reciever to sell the house, but what happens with the repossession? who will win? Also if we make an application to rent and are already bankrupt we have to pay 6 months rent upront as well as bond and agency fees - which we just dont have - and wouldnt have from either the house sale or the repo or bankruptcy but may be able to get a small amount of cash together to rent now." There seems to be more posts like this every week.
  5. Friends of mine have also recently moved up from a pleasant 3 bed semi with a 70k repayment mortgage to a 240K IO mortgage(self-cert) to buy their dream home, an 'ideal modernisation project' which translated as a moneypit, they've spend at least 50K and its no where near finished but have now run out of money. Why do people in their late 40's feel the need to take such risk. A term used in mental health and psychology is the 'Tyranny of Shoulds' society is constantly telling people what they should have or achieve to be considered successful. The rise is house prices has interupted what many considered the natural progress up the ladder, the cost of moving up the next rung now requires the willingness to take on huge debt but staying put which makes many feel that they have failed in some way. When I asked my friend why they were taking such a risk I was told " Its what you have to do if you what to get on"
  6. I was suprised by this from what I can gather the possession order remains in place after the arrears have been cleared unless the judge orders it to be lifted. After the orginal arrears have been paid the HO can go back to the court to request the removal of the possession order.
  7. Hi from what I can gather the main consideration is that the regular mortgage payments are made with additional payments to clear the debt, this can be over years, also some lenders with after a period of time consolidate the arrears into the mortgage if the HO has been a goodboy/girl and not defaulted again. It seems at the moment that neither the courts nor the lenders wish to push for repossession I doubt this is a humanitarian gesture, they just don't want to scare off future lenders.
  8. From what I know the courts will only repossess if it is considered that the homeowner cannot or will not be able to pay the mortgage and arrears over a reasonable period of time. A friend who works in Debt advice said that the banks and building societies will generally not request repossessions as they don't want the publicity. What they do request is Suspended repossessions, which means they have been granted possession but the HO is given time to repay the debt, BUT the possession order still exists on the property after the arrears are cleared which means that should the HO default again at any time during the mortgage term the bank or BS can proceed to immediate repossession without going back to court. That could be 5 -10 years after the original arrears.
  9. The IO mortgage is not only being used by desperate FTB. I know I number of people who have remortgaged to IO mortgage from traditional repayment in most cases to clear debts, one couple I know had a 100K repayment mortgage 8 years ago now have a 200K IO mortgage on the same house.
  10. Hi I'm a homeowner, have been for 25 years now in second house. I would welcome HPC, I have approximately 120K equity in my home, but as the average 3 bed semi in my area is 250-300K I would need to take on a mortgage of 130-180K if I wished to move. houses in my area have tripled in value in the last 6 years, total out of the range of FTB's and has produced an increasingly static market as homeowners are becoming unable to move up. The homeowners who fear a HPC are those who have MEW'ed to the hilt or bought recently; other than them a HPC is a benefit to all.
  11. Hi another long time lurker here, bit different from the majority as I am a homeowner. Found this site by accident, great to realise that others shared my views and concerns about societies attitude to money and debt and the scandal that is house prices. In the last two years I have watched a number of people buying large luxury homes, at that point I assumed they could afford it (inheritances, bonuses etc), it didn't occur to me that these people would take on huge debt they could'nt afford. This view changed when a long time friend announced they had bought a new house, they have a history of poor financial decision making, MEW'ed their home 3 times to pay off debts. They had taken on a mortgage of over 250K interest only, self cert at least 6X income. When i asked why they were taking such a risk I was told " its what you have to do to get on, you have to follow your dream." This dream is rapidly turning into a nightmare, for my friends and others, people are being manupulated into seeing huge debt as a normal part of life, it is very persuasive, my friend are in their late 40's they felt they 'deserved' a bigger house the media driven aspirational lifestyle has hooked the majority and created a distored view of what is normal. As the parent of two teenagers I welcome a house price crash, i want them to be able to get a decent job and to be able to afford a home without a lifetime of debt I do not want to have my children living at home til their 30's. Like many on this site you can often feel that a lone voice in the wilderness. the problem is that the VI tell the majority what they want to hear , we dont.
  12. Hi long long time lurker here in need of the assistance of the financially literate board members. A thread on Motley fool pension board was discussing the fall in gilt yields wiping millions of the value of pension funds, this article in the FT suggests that this could impact on the housing market. http://news.ft.com/cms/s/f404b3e0-8958-11d...00779e2340.html Quote:Ben Broadbent, economist at Goldman Sachs, says that super-low bond yields may over time cause the misallocation of capital - hurting small companies relative to large ones - and threaten economic stability. "The market favours investment in large companies, which have the access to securities such as bonds and equities, but the smaller companies grow faster. Pushing resour-ces into big, mature companies could, at the margin, slow down the growth of the economy." He points out the extremely low level of bond yields threatens to push up other asset prices, including house prices. "Given the fall in yields, there is a big incentive to offer long-term mortgages, pushing the average rate of mortages lower, and subsequently pushing up house prices further." I have no knowledge of stock market, gilts, bonds etc and would welcome the boards assessment and hopefully dismissal of this statement.
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