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Families On The Brink Of 'insolvency Crisis'

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http://www.dailymail.co.uk/news/article-1289413/Families-brink-insolvency-crisis-decade-long-credit-card-binge.html

Families on the brink of 'insolvency crisis' after decade-long credit card binge
By SAM FLEMING
Debt stress: Thousands of families are spiralling into insolvency. (Posed by models)
Families are drowning in debt after a decade-long binge on credit cards.
The Bank of England today warns lenders are writing off record quantities of credit card borrowings as thousands of individuals spiral into insolvency.
Lenders are responding by pushing up interest rates even higher, putting more families in financial trouble, the Bank said in its Financial Stability Report.

Yeserdayit was record saving going on. :blink:

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http://www.dailymail...card-binge.html

Families on the brink of 'insolvency crisis' after decade-long credit card binge
By SAM FLEMING
Debt stress: Thousands of families are spiralling into insolvency. (Posed by models)
Families are drowning in debt after a decade-long binge on credit cards.
The Bank of England today warns lenders are writing off record quantities of credit card borrowings as thousands of individuals spiral into insolvency.
Lenders are responding by pushing up interest rates even higher, putting more families in financial trouble, the Bank said in its Financial Stability Report.

Yeserdayit was record saving going on. :blink:

A real vicious circle. As more debts are written off the banks are raising the interest rates on the debts that are left which causes more people to default and so on. Questions need to be asked regarding why charging 50 - 60 times the BOE base rate is still not enough interest to reflect the additional danger of unsecured debt. Or are the banks just being opportunist and greedy.

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http://www.dailymail.co.uk/news/article-1289413/Families-brink-insolvency-crisis-decade-long-credit-card-binge.html

Families on the brink of 'insolvency crisis' after decade-long credit card binge
By SAM FLEMING
Debt stress: Thousands of families are spiralling into insolvency. (Posed by models)
Families are drowning in debt after a decade-long binge on credit cards.
The Bank of England today warns lenders are writing off record quantities of credit card borrowings as thousands of individuals spiral into insolvency.
Lenders are responding by pushing up interest rates even higher, putting more families in financial trouble, the Bank said in its Financial Stability Report.

Yeserdayit was record saving going on. :blink:

The two stories are not inconsistent.

When banks write off personal loans, personal indebtedness falls which pushes up the savings rate.

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The two stories are not inconsistent.

When banks write off personal loans, personal indebtedness falls which pushes up the savings rate.

I suppose it depends upon the relative speed each factor is able to maintain. Also, as banks write more and more off the remaining sheeple pay more by way of IR and increase insolvency rates.

Something has gotta give in these kinds of debt writedown spirals. I doubt it will be a positive outcome in the form of more savings.

Deflation maybe as credit is sopped up and no new money comes into the market.

Edited by Realistbear

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The average family on £45,000 a year will suffer a hit of more than £700 to their take-home pay as a result of the Government’s decisions, research for the Daily Mail shows.

Sorry, how did they work that out? Isn't average household income around 30k? Anyone with linky?

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I suppose it depends upon the relative speed each factor is able to maintain. Also, as banks write more and more off the remaining sheeple pay more by way of IR and increase insolvency rates.

Something has gotta give in these kinds of debt writedown spirals. I doubt it will be a positive outcome in the form of more savings.

Deflation maybe as credit is sopped up and no new money comes into the market.

The race between balance sheet repair and defaults is probably going to be won by defaults despite ZIRP / QE.

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£4.5 billion, 10% of all credit card loans in the past 12 months, just written off. :o

That figure is staggering.

Not much incentive to people to bother paying back their loans, if they know the banks are writing off as many loans as this.

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Can anyone confirm ...if you go bankrupt does that basically mean you will also have to sell up or lose your house? Is it possible to keep your house and still go bankrupt?

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Can anyone confirm ...if you go bankrupt does that basically mean you will also have to sell up or lose your house? Is it possible to keep your house and still go bankrupt?

Transfer house into spouse's name, then go bankrupt is the ruse I believe.

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A real vicious circle. As more debts are written off the banks are raising the interest rates on the debts that are left which causes more people to default and so on. Questions need to be asked regarding why charging 50 - 60 times the BOE base rate is still not enough interest to reflect the additional danger of unsecured debt. Or are the banks just being opportunist and greedy.

Catch 22.

However from the banks perspective the faster they write this stuff off the quicker the taxpayer will pick up the tab.

Anyone like to bet RBS/Lloyd's are writing the most off?

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A real vicious circle. As more debts are written off the banks are raising the interest rates on the debts that are left which causes more people to default and so on. Questions need to be asked regarding why charging 50 - 60 times the BOE base rate is still not enough interest to reflect the additional danger of unsecured debt. Or are the banks just being opportunist and greedy.

It's exactly what the banks tried in the USA!

Cheating banks were loading on the missed payment fines at ever higher rates and charging higher and higher interest rates. I vaguely remember they doubled interest rates almost overnight with some cards!

Obama had to legislate against them! Don't expect anything here!

If you think about it, the more they raise the rates here the more defaults, ending in another bank bailout by the bank of the UK public ( all hidden by the city+ GOVT fraudsters, as they now don't have to publicly declare they are being bailed out again, supposedly to stop bank runs - fekking liars!)

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Oh look! another article on 'families' in financial trouble. Boo hoo!

Well if someone in the family had took charge of the fiances, acted more responsibly and less selfishly then they would've never got into trouble in the first place.

Short of loosing your job and been unemployed for at least 3 months nothing should push you to the brink, certainly not credit cards.

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Oh look! another article on 'families' in financial trouble. Boo hoo!

Well if someone in the family had took charge of the fiances, acted more responsibly and less selfishly then they would've never got into trouble in the first place.

Short of loosing your job and been unemployed for at least 3 months nothing should push you to the brink, certainly not credit cards.

the gestapo will be along in a minute to sort you out

i am sure most understood what you meant which is all that matters

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Guest sillybear2

£4.5 billion, 10% of all credit card loans in the past 12 months, just written off. :o

That figure is staggering.

Not much incentive to people to bother paying back their loans, if they know the banks are writing off as many loans as this.

Remember a lot of that money isn't real lending but magic money they won't get back, i.e. balances that grew as a result of compound interest at 20% combined with a load of late fee's.

I'm sure the BoE is holding a lot of this crap via the Asset Purchase Scheme and SLS so defaults will be paid for via inflation of the money supply.

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Guest sillybear2

article-1168286-04560AA7000005DC-696_468x333.jpg

Uhh ohh, what are you insinuating, I hope you can afford the legal fee's.

‘I am sitting in our £5million chateau in Megeve in the Alps. I will sue anyone who says that Imagine Homes is in financial difficulty. We are 20 per cent owned by HBoS and we have huge profits that have yet to materialise.’

Ahh, it never gets old. :lol:

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Remember a lot of that money isn't real lending but magic money they won't get back, i.e. balances that grew as a result of compound interest at 20% combined with a load of late fee's.

Exactly.

The fact that more people get credit cards these days means banks will write off bad debts at ever increasing rates. They've also got extremely efficient at punishing people aggressively if they "break the rules" of the credit card with fees and interest racking up big balances. Banks always expect that people will default - they just use credit scoring to minimise the defaults but they can't totally manage it - there are too many variables. Over the years as banks have made more money they can write off more debt if they have to. It looked like it was going ti*s up with Northern Rock et al but it looks like business as normal again.

I am constantly staggered that the plates are still spinning but there you go - I guess we all are a bit.

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Can anyone confirm ...if you go bankrupt does that basically mean you will also have to sell up or lose your house? Is it possible to keep your house and still go bankrupt?

If there is significant equity in your house then you will lose it . Transferring it into your wife' s name won't work if it is done within a few years of going bankrupt; the Official Receiver has the power to declare the transaction null and void.

If however, there is little or no equity in the house the Official Receiver will not be interested in it and you will get to keep it. You will be able to buy the 'beneficial interest' in the house from the OR for a nominal sum and so long as you carry on paying the mortgage it is all yours. You even get to keep in full any future capital gains.

Of course, having all your unsecured debts wiped clean makes it a lot easier to pay the mortgage going forward. Bankruptcy is an excellent idea for anyone with credit card debts and negative equity in their home.

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Can anyone confirm ...if you go bankrupt does that basically mean you will also have to sell up or lose your house? Is it possible to keep your house and still go bankrupt?

It depends ,

When you go bankrupt all your assets become the property of the offical receiver, anything with any value will be sold to release funds and pay of creditors.

However if you have a house and there is no equity in it they may let you transfer it over to your spouce . Especially if you have children . Happened to a friend last year the house is now in the wife's name . But whether they can keep it long term is anyones guess ,as they have massive Intrest only mortgage , which relatives are paying for them at present.

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A real vicious circle. As more debts are written off the banks are raising the interest rates on the debts that are left which causes more people to default and so on. Questions need to be asked regarding why charging 50 - 60 times the BOE base rate is still not enough interest to reflect the additional danger of unsecured debt. Or are the banks just being opportunist and greedy.

To try to rebuild their balance sheets, cover the cost of all the people defaulting and, of cause, pay their own bonuses.

To be fair though, a typical tracker mortgage is about 2.5% so only 5 times base rate.

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Classis reply... it genuinely shocks me that people as stupid as this exist

Reading comments from people who are better off telling me its 'my fault' makes me mad. i havevn't run up these depts living beyond my means, i just want my family to enjoy the same standard of living as everyone else. why should we suffer?

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£4.5 billion, 10% of all credit card loans in the past 12 months, just written off. :o

That figure is staggering.

Not much incentive to people to bother paying back their loans, if they know the banks are writing off as many loans as this.

Written off by the bank, not written off entirely. Usually these loans are sold on to 3rd parties who are much more tenacious than the banks when it comes to getting their pound of flesh.

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If there is significant equity in your house then you will lose it . Transferring it into your wife' s name won't work if it is done within a  few years of going bankrupt; the Official Receiver has the power to declare the transaction null and void.

If however, there is little or no equity in the house the Official Receiver will not be interested in it and you will get to keep it. You will be able to buy the 'beneficial interest' in the house from the OR for a nominal sum and so long as you carry on paying the mortgage it is all yours. You even get to keep in full any future capital gains.

Of course, having all your unsecured debts wiped clean makes it a lot easier to pay the mortgage going forward. Bankruptcy is an excellent idea for anyone with credit card debts and negative equity in their home.

Spot on. The ultimate heroic escape for the chancers.Are you in the business, or does this knowledge come from personal experience?

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  • 261 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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