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man o' the year

When Does The Bank Start Getting Stroppy?

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A friend confided in me the other day. They had a one account and were worried since in arrears.

Property valued at £320k (I dont know when this happened but may have been 2000 when he bought).

Facility is supposed to be £220k but is now at £226k.

He is worried about being forced to sell.

Clearly if he could he should have equity £94k but I unhelpfully pointed out that he might not get valuation. Anyone help with value now if followed south west pattern?

The worst thing for him was that repaying at present he is only paying a little off per month so at present rate will repay in ...

63 years. Gulp!

Is this normal for One Accounts? I have no experience of them.

Sounds like only a question of time as he is only sporadically in work. Oh and he has £10k of other debt.

Edited by man o' the year

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Sounds to me like he is swimming against the tide. He'll get washed out to sea in 2012/2013 mark my words.

I have found out since that a substantial part of the loan about (£200k) is supposedly repayable by some other means.I dont know if the means to do this exists at all but it is likely underwater as indicated by the other debt and the fact that he is behind on the one account too. This is exacerbated by the fact that the "facility" of the mortgage also reduces gradually.

He is just anxious as to when the bank will start pressure.

I think I know. The answer is when they feel it will be most profitable for them to do so. That might not be too far away. His property is unique and in disrepair so difficult to value.

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Banks have been very very lenient - pressure from govt and unwillingness to crystalise debt are the reasons for that. He should keep communication open with the bank if they start to increase the pressure.

Instead of worrying about when they will foreclose, if it was me, I'd be thinking about getting another job and putting 100% of that extra money into paying off debts and mortgage.

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  • 311 Brexit, House prices and Summer 2020

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