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jungllie jim

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Britain’s biggest lender is under-pricing homes by up to 35%, despite the upturn in the housing market — potentially adding £12,000 to the cost of mortgage borrowing.

House prices are up 4% from their April trough, according to the Halifax house price index, and have risen 7.8% on Nationwide's index from a February low. On both, prices are down 20% from their 2007 peaks.

However, brokers are reporting huge property “down-valuations†by Halifax, owned by taxpayer-backed Lloyds Banking Group — a move that could lock borrowers out of the top deals. Halifax’s best five-year fixed rate for its borrowers with only 10% equity is 6.19%. However, if you had 40% equity, you would be best off moving to another lender: HSBC charges just 4.95%. The difference could take £12,400 off the cost of a £200,000 mortgage over five years.

It's a way of jacking up the profits.

Plus it's a way of recovering the loan, if they move lenders the halifax (taxpayer) gets the money back.

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Britain’s biggest lender is under-pricing homes by up to 35%, despite the upturn in the housing market — potentially adding £12,000 to the cost of mortgage borrowing.
Ray Boulger of John Charcol, the broker, said: “This is a shockingly big down-valuation and a number of clients are finding themselves in the same position.â€

What a crock of sh*t. Why wasn't Boulger complaining of over-valuations as the market dangerously bubbled? But we've been through this argument many times before and there's nothing really to add. It's just funny to see The Times whine about "under valuing" for the umpteenth time.

Edited by Turnbull2000

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