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Worse Economic Crisis Ever And Mortgage 'owners' Still Smug?


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No you have to steel yourself for hard times.

I have household financial records going back to the 1970's. In real (inflation adjusted) terms food, electricity, gas and petrol took a much higher proportion of my salary than now. Inflation at 5% then would have been considered negligible.

It would have been nice to be able to save, let alone whinge about how low interest on savings is.

Wut? That's not actually a meaningful response.

It was put to you that current policies are stealing from savers through inflation. You seem to be saying that inflation existed in the 70s, and thus, today's transfer of wealth is not actually theft.

By the same token, I can only assume that as a juror, you would exonerate an armed robber today, based on the historical existence of the Great Train Robbery.

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Reposesions are a good thing - it simply replaces insolvent home owners with solvent ones which can only be beneficial to the general economy, theres still the same number of people living in the same number of houses and the same number of people "homeless".

........If only you were right.' Homeless person picks up bargain property following eviction of greedy rich boomer'.....that would be a headline to cheer the hearts of many on this site........all is not lost though.....a homeless family may be housed......however their rent will be paid by Housing Benefit to a BTL leech who has just added one more property to his portfolio.

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........If only you were right.' Homeless person picks up bargain property following eviction of greedy rich boomer'.....that would be a headline to cheer the hearts of many on this site........all is not lost though.....a homeless family may be housed......however their rent will be paid by Housing Benefit to a BTL leech who has just added one more property to his portfolio.

Unless they move in with friends or relatives. A couple I know have two kids. They were renting until the landlord decided he needed his house back. They couldnt afford to buy and the rents being asked elsewhere mean that they can not reasonably afford a three bed home that they need. So they've moved in with guys parents. Luckily they have four bedrooms and a few reception rooms so there is enough room. Obviously this isn't an option for many but it does happen.

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only an idiot would put long term savings in cash right now, you have no right to a guaranteed safe return

as it stands home owners are still losing big time in real terms falls, but simpyl denying it at the same time

True but it's the place of least risk. There is no where currently that you can guarantee a safe returns.

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only an idiot would put long term savings in cash right now, you have no right to a guaranteed safe return

as it stands home owners are still losing big time in real terms falls, but simpyl denying it at the same time

My savings are in cash right now, guess that makes me an idiot..... or perhaps not, time will tell.

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It's funny that you should mention this .. my sis works for a local authority as a housing officer .. Most of the people who come to her are people with mortgage arrears who are being repossesed .. what they want is a council house .. she has very few of those so she has to try and keep them in their own home .. she spends most of the time on the phone to lenders trying to pay off peoples arrears and move them to an affordable mortgage.

With people in Negative equity it's pretty easy, she comes up with a figure that they can afford and tells the mortgage company they can have that or repo the property. There is no way the mortgage company will say no, so you have people who have 200,000 mortgages who are paying £500 a month for an interest only mortgage.

Recently she had a chap come to her he had lost his job and (for whatever reason) did not apply for benefits .. paid the mortgage out of his savings while eh looked for a new job .. the bank lost it's rag very very quickly when he fell behind with the mortgage and his house was going to be repo'd on the following Friday.

Nothing absolutely NOTHING would persuade the bank to lend to him at anything but punitive rates of interest (9.75 %!) Even if she paid all the arrears the cost of his mortgage from that moment on would be 750-800 a month .. more than twice what it would have been before ..

Reason ? He 5 years from paying off an £80,000 mortgage .. and he had 85% equity in his house .. eventually my sister managed to find someone who would give him a 1 year IO mortgage at 6% after all the fees and penalties had been added in he had to get a £28,000 mortgage.

Oh and of course he's not now eligible for SMI because he has got a job ..

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I'm sure you would. Would you laugh at the kids as the family left their home as well?

Maybe not laugh at them, but they're not my kids are they. Just someone else's story. Rory Weal laugh at. He's still blaming the coalition government for where we are now, which is actually still a very rosy place for people who took on too much debt. All the kids of homeowners are not my responsibility. My responsibility is to my own family, as should have been their parents by meeting their debt commitments and not taking on too many extra risks.

Homeowners who took on more debt than they can service on their contract were unlikely to be thinking of the parents of kids in rented when they bought. More likely to have looked down on them for not getting with the HPI sure thing because house prices historically always go up by a lot and all that stuff.

At least RW Dad did get dealt with by his creditors and saw properties repo-ed, but that was 3 years ago. Hopefully these repos are still taking place, and will be on the increase, especially against homeowners who chose to put themselves in such precarious debt positions.

RoryLabour_DebtDaddyRepo.jpg

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The problem is that more and more of our GDP is being devoted to bailing out private debt, either through monetary policy or through state aid or indirectly through nationalisation of banking. Eventually there will be no money for anything else. no defence, no NHS, no schools, no police. And the state is adding more and more to the "tab" that really is debt, but is labelled as something else, like the 60k per student at university, and all the PFI stuff. No other country in Europe (including Greece) is as screwed as UK. And of course Greece now has the EZ holding its hand while UK is well and truly outside the circle of trust. Government and BoE can only play the extend and pretend game for so long. Our infrastructure is crumbling. We need new power stations. We need to import gas. When we're on QE Mk7 and the pound is worth half a Euro, inflation will be so massive that even Merv will have to admit there's a problem. Interest rates and fiscal policy will be set by the IMF, and by then I suspect we will be muttering about "those lucky Greek b'tards". IRs will rise and house prices will collapse. However I think it will be a hollow victory. There is obviously a reason why UK is investing so much in keeping house prices inflated. It is about fear, and although I don't know for sure, I'm guessing that it is well founded fear that a fall in house prices will bring about catastrophic economic and social collapse. I can't see potential FTBs benefiting much from that scenario.

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