Guest The_Oldie Posted December 1, 2005 Share Posted December 1, 2005 I was talking to an EA the other day. His sales pitch was that the market will be boosted when "Japanese Mortgages" become available mid 2006. Japanese mortgages are apparently over 65 years and are repaid by two or more generations. What will they think of next . Quote Link to comment Share on other sites More sharing options...
Guest consa Posted December 1, 2005 Share Posted December 1, 2005 I was talking to an EA the other day. His sales pitch was that the market will be boosted when "Japanese Mortgages" become available mid 2006. Japanese mortgages are apparently over 65 years and are repaid by two or more generations. What will they think of next . I would say that this is not true, in any case if you were to take out a yen mortgage you would in effect be gambling on the exchange rate and your repayments would fluctuate accordingly proving very costly. Although interest rates are in effect zero I suspect mortgage rates aren't, Japan has very strict financial regulations. Quote Link to comment Share on other sites More sharing options...
Milkshock Posted December 1, 2005 Share Posted December 1, 2005 I would say that this is not true, in any case if you were to take out a yen mortgage you would in effect be gambling on the exchange rate and your repayments would fluctuate accordingly proving very costly. Although interest rates are in effect zero I suspect mortgage rates aren't, Japan has very strict financial regulations. I think he means the style of mortgage will be Japanese - not the mortgage itself. Quote Link to comment Share on other sites More sharing options...
MarkG Posted December 1, 2005 Share Posted December 1, 2005 Japanese mortgages are apparently over 65 years and are repaid by two or more generations. And they were just so successful at preventing a house price crash in Japan. Quote Link to comment Share on other sites More sharing options...
Guest The_Oldie Posted December 1, 2005 Share Posted December 1, 2005 I would say that this is not true, in any case if you were to take out a yen mortgage you would in effect be gambling on the exchange rate and your repayments would fluctuate accordingly proving very costly. Although interest rates are in effect zero I suspect mortgage rates aren't, Japan has very strict financial regulations. No, he said it was not in yen, but was so named because this type of mortgage was introduced in Japan when their HPI meant that housing was unaffordable unless spread over that time period. Quote Link to comment Share on other sites More sharing options...
Milkshock Posted December 1, 2005 Share Posted December 1, 2005 No, he said it was not in yen, but was so named because this type of mortgage was introduced in Japan when their HPI meant that housing was unaffordable unless spread over that time period. As far as i am aware, debts in general are inter-generational in Japan, so I think there may have been historical and cultural precendent for this. Don't think it would go down well here though! Quote Link to comment Share on other sites More sharing options...
AteMoose Posted December 1, 2005 Share Posted December 1, 2005 (edited) debts in japan and inter generational, and one reason for high prices and low population growth, i believe having a debt that can be passed onto your kids is against the law in the uk, so the EA is talking aout of his bottom. we have 65 year morgages already, there very popular, there called interest only, you pay the interest until you die... Edited December 1, 2005 by moosetea Quote Link to comment Share on other sites More sharing options...
underpressuretobuy Posted December 1, 2005 Share Posted December 1, 2005 i believe having a debt that can be passed onto your kids is against the law in the uk, I don't think it is against the law in the uk. I am sure that if you take out debts (including mortgages) in this country without insurance (that will repay the debt in the event of your untimely death) then the debt will pass to your next of kin. Perhaps someone else could clarify but I am sure I have heard stories of people being lumbered with someone else's mortgage because the person who originally took the mortgage out couldn't be bothered to pay insurance and died before the entire debt was repaid. Quote Link to comment Share on other sites More sharing options...
AteMoose Posted December 1, 2005 Share Posted December 1, 2005 (edited) I don't think it is against the law in the uk. I am sure that if you take out debts (including mortgages) in this country without insurance (that will repay the debt in the event of your untimely death) then the debt will pass to your next of kin. Perhaps someone else could clarify but I am sure I have heard stories of people being lumbered with someone else's mortgage because the person who originally took the mortgage out couldn't be bothered to pay insurance and died before the entire debt was repaid. http://www.clear-your-debt.co.uk/debt-death.htm No one else has to pay for the debts of someone who as died unless they are already liable under the terms of the original agreement, eg the debt is in joint names or someone has signed as a guarantor. Dealing with an estate can be complicated. You may need legal advice. The Home Your next of kin would have to agree to take this debt on on your death, when applying for the morgage/loan Edited December 1, 2005 by moosetea Quote Link to comment Share on other sites More sharing options...
Guest consa Posted December 1, 2005 Share Posted December 1, 2005 No, he said it was not in yen, but was so named because this type of mortgage was introduced in Japan when their HPI meant that housing was unaffordable unless spread over that time period. OK, I got the wrong end of the stick Who in their right mind is going to want to saddle themselves and their dependants with a 65 year loan, those japs are crazy people have you seen some of the stuff they do on TV Quote Link to comment Share on other sites More sharing options...
AteMoose Posted December 1, 2005 Share Posted December 1, 2005 (edited) OK, I got the wrong end of the stick Who in their right mind is going to want to saddle themselves and their dependants with a 65 year loan, those japs are crazy people have you seen some of the stuff they do on TV Japan had and still has 100 year morgages! http://news.bbc.co.uk/1/hi/business/2027576.stm They still have these long term inter generational morgages, it fueled there last house price boom, and caused there 15 year HPC. Interesting they still have 100 year morgages, and 0->1% interest rates, and a long period of falling house prices properties in japan are now a similar value to properties in london.... Edited December 1, 2005 by moosetea Quote Link to comment Share on other sites More sharing options...
Carabansity Posted December 1, 2005 Share Posted December 1, 2005 The Yorkshire bank (owned by an Australian company) used to advertise Australian style mortgages. Something to do with paying off capital every month rather than at the end of the year so the amount repaid or term would be shorter. Didn't seem like a good deal for the banks so didn't catch on here. I like the idea of a fixed rate mortage for the term of the loan. I think until recently Americans had this sort of mortgage but have moved into the sort of constantly changing ones we have because of HPI over there. Quote Link to comment Share on other sites More sharing options...
eek Posted December 1, 2005 Share Posted December 1, 2005 I don't think it is against the law in the uk. I am sure that if you take out debts (including mortgages) in this country without insurance (that will repay the debt in the event of your untimely death) then the debt will pass to your next of kin. Perhaps someone else could clarify but I am sure I have heard stories of people being lumbered with someone else's mortgage because the person who originally took the mortgage out couldn't be bothered to pay insurance and died before the entire debt was repaid. No its passed to the estate to be paid. The debts have to be paid before anything left can be paid out as per the terms of the will. If the debts of the estate are greater than the assets then the debt simply won't be paid. As for whether these mortgages would be legal in the Uk only if all parties agreeing to it are over 18. In that case its tough the debt will pass from the person who dies to the other person who agreed to pay it. The Yorkshire bank (owned by an Australian company) used to advertise Australian style mortgages. Something to do with paying off capital every month rather than at the end of the year so the amount repaid or term would be shorter. Didn't seem like a good deal for the banks so didn't catch on here. I like the idea of a fixed rate mortage for the term of the loan. I think until recently Americans had this sort of mortgage but have moved into the sort of constantly changing ones we have because of HPI over there. Monthly payments means that the amount owed calculated on a monthly basis rather than an annual basis. I think its saves something like 4 months repayments if interest is calculated that way. Quote Link to comment Share on other sites More sharing options...
Michael Posted December 1, 2005 Share Posted December 1, 2005 load of nonsense and a red herring as de facto long term mortgages already exist here in the form of................infinity(interest only )mortgages......and you could turn one of these into a 65 year /100 year or 1000 year!!!!!!!!!! mortgage by putting money aside to pay off the capital in that period or any length of period you chose............. Quote Link to comment Share on other sites More sharing options...
Guest The_Oldie Posted December 1, 2005 Share Posted December 1, 2005 As I thought, just a load of EA spin then. Makes a change from the usual SIPPS, SIPPS, SIPPS though . Quote Link to comment Share on other sites More sharing options...
IP Newcomer Posted December 1, 2005 Share Posted December 1, 2005 As far as i am aware, debts in general are inter-generational in Japan, so I think there may have been historical and cultural precendent for this. Don't think it would go down well here though! Which investors would be mad enough to underwrite a loan against a 9 year old's future earning capacity / disinclination to pay debts. Well at least parents will be paying more attention to their little darlings school reports before sending them off with the mortgage application. Quote Link to comment Share on other sites More sharing options...
Karen Posted December 1, 2005 Share Posted December 1, 2005 (edited) I was talking to an EA the other day. His sales pitch was that the market will be boosted when "Japanese Mortgages" become available mid 2006. Japanese mortgages are apparently over 65 years and are repaid by two or more generations. What will they think of next . How much lower would the payments be for 65 years Vs 30 years? I doubt much. IMHO a bad idea, but I bet there is some idiot gung ho for it. Americans still have fixed rate mortgages. Adjustable are more popular in bubble areas because it's the only way people making 60K a year can afford to spend 500K on a house. (and I use the term afford loosely) Edited December 1, 2005 by Karen Quote Link to comment Share on other sites More sharing options...
BuyingBear Posted December 1, 2005 Share Posted December 1, 2005 As far as i am aware, debts in general are inter-generational in Japan, so I think there may have been historical and cultural precendent for this. Don't think it would go down well here though! You haven't seen our pension system! Quote Link to comment Share on other sites More sharing options...
Converted Lurker Posted December 1, 2005 Share Posted December 1, 2005 I was talking to an EA the other day. His sales pitch was that the market will be boosted when "Japanese Mortgages" become available mid 2006. Japanese mortgages are apparently over 65 years and are repaid by two or more generations. What will they think of next . Hmm...OK..there was this Director of the securitised and structured department of a Bank as big as they come who when pitched the idea of 50 year mortgages for the ftb did not fall off the chair as much as the pitcher would have expected. Problems? not term, but age of applicant, the life insurance aspect gets interesting, would you give a 50 year deal to someone aged 35? This passnig the debt on to the kids is a bit of an urban myth. "er no thanks Dad don`t want the neg. eq.". Also this Director actually wanted to wait until a correction had occured to back this potential idea and he knew the correction was coming (even 18 months ago) as he was one of the biggest swinging dicks of the city. The product could be interesting..starts of fifty years, but the borrower can reduce, without penalty, the term as their income grows and pay the loan down in any way they can. If this deal was offered exclusively to the FTB it could get interesting IMHO Quote Link to comment Share on other sites More sharing options...
Converted Lurker Posted December 1, 2005 Share Posted December 1, 2005 "Do you dress to the left, sir?" Believe me, every swinging dick is positioned (either hedged or out of houses (or Mr Fvxtons)). Or super-long for a government get-out-clause. (Personally, I'm short government. My dick swings - short. That's the trouble with being a bear.) I`m gonna read liars poker again Quote Link to comment Share on other sites More sharing options...
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