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75yr old couple with IO mtg

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Just getting started.

Lots of people will be extending and pretending as we speak. Will they make it through another recession? Or get too old too soon? How long until the bank decides to call it a day for them?

interest-only-mortgages-graph.jpg.ee45295a624e3daba90c5e9ab782266d.jpg

258141049_ioredemptions.png.fa4ed9dba3621a6f77169cf8819f6eac.png

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This is the fate that awaits most millenials. Two lifetimes of work and nothing to show for it. 

For people of their generation to end up there though... that must have taken some extraordinarily bad decisions, or bad luck.

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A lot about this story doesn't make sense.

The couple went IO when the woman lost her job at 65. Exactly how long was she planning on staying working?

The man was/is an accountant so ought to know a thing or two about finance. Why didn't he see this coming years ago and pay down the lump sum, move somewhere more affordable or get on the council housing list?

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In all honesty I logged onto this thread thinking this will be just a made up anecdote by one of our more colourful posters, but no it's real, blimey. Yet again the good old sympathy card is being played when this couple no doubt knew the rules, we will approach the media and make the bank look bad because we are old and frail, they are 100% in the wrong.

I know of much younger people doing this as well, they look the dog's ****** in their big IO homes and probably paying a lot less than rent and knowing they can keep the equity, but it is a gamble using QE money in a lot of cases and should be stamped out.

Edited by Guest

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Guest

Looking at the 76 year old bloke you just know he was the golf playing member type who probably bragged about what his house was for years and how clever he was, now that time has caught up with him and his BS his only option is playing the victim, what not surpise me if they are working on having a baby to make it more emotive

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3 minutes ago, inbruges said:

Looking at the 76 year old bloke you just know he was the golf playing member type who probably bragged about what his house was for years and how clever he was, now that time has caught up with him and his BS his only option is playing the victim, what not surpise me if they are working on having a baby to make it more emotive

quoting both posts. No sympathy for this lot. What did they expect would happen? 

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24 minutes ago, dropbear said:

This is the fate that awaits most millenials. Two lifetimes of work and nothing to show for it. 

For people of their generation to end up there though... that must have taken some extraordinarily bad decisions, or bad luck.

It's just possible that they were like a friend of ours, back in the late 70s/early 80s, who scoffed at us for doing anything so boring and 'bourgeois' - as he kindly put it - as buying a house. 

 

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Why should anyone be sympathetic, IO mortgage payers with no way to repay must have accumulated equity during the IO paying days.....their home must hold some value. More than a 75 year old paying rent all their lives, rent is higher than IO, they have nothing to sell, only paid someone else's mortgage.....who will pay their rent if their pensions can't?.......they are the people, people should have sympathy with.;)

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21 minutes ago, stuckmojo said:

quoting both posts. No sympathy for this lot. What did they expect would happen? 

A lot of people went on IO after the 2007/08 financial crisis, so they basically made zero provisions should things get a little tougher, and that was the way it has always been. Yet again I and many on here punished for not being stupid.

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Just wondering how they come to have a 180k mortgage on a 260k house after 17 years. Eastbourne prices have probably tripled in that time. 95% of the time this wouldn't be a problem because the mortgagor would just switch to Equity release but they would need at least 50% Equity in the house. The 25% they have suggests remortgaging.

Edited by crashmonitor

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10 minutes ago, crashmonitor said:

Len hasn't been able to work since 2011. He was 70 then for God's sake.

They are the sort of people who have no forethought, they avoid paying any bill they can get away with paying..... some say or think a magic money pot will materialise when they need it in the future all will be well, save the day of reckoning....let's spend today whilst can get away with it... tomorrow is another day.;)

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3 minutes ago, winkie said:

They are the sort of people who have no forethought, they avoid paying any bill they can get away with paying..... some say or think a magic money pot will materialise when they need it in the future all will be well, save the day of reckoning....let's spend today whilst can get away with it... tomorrow is another day.;)

Think they are just greedy bastards who think they will always be bailed out without taking any personal responsibility

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Not sure why the article says "their home"..? I'd also face eviction if I stop paying my rent or the landlord doesn't want me anymore, should I go to newspapers to moan about it..?

Edited by Paul77

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36 minutes ago, crashmonitor said:

Just wondering how they come to have a 180k mortgage on a 260k house after 17 years. Eastbourne prices have probably tripled in that time. 95% of the time this wouldn't be a problem because the mortgagor would just switch to Equity release but they would need at least 50% Equity in the house. The 25% they have suggests remortgaging.

MEW...

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10 hours ago, Parkwell said:

Just getting started.

Lots of people will be extending and pretending as we speak. Will they make it through another recession? Or get too old too soon? How long until the bank decides to call it a day for them?

interest-only-mortgages-graph.jpg.ee45295a624e3daba90c5e9ab782266d.jpg

258141049_ioredemptions.png.fa4ed9dba3621a6f77169cf8819f6eac.png

That 2nd graph indicates a good buying opportunty circa 2030..

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2 hours ago, tomandlu said:

The Guardian have picked up on this now as well.

https://www.theguardian.com/money/2018/may/02/elderly-couple-face-losing-home-as-interest-only-loan-crisis-bites

Haven't fully read their version, but the comments BTL are mostly negative.

"The couple’s MP, Stephen Lloyd, said: “This is a frail elderly couple who always paid their mortgage interest"

..............

 

This all you need to read and it make me sick, time and time again. This "poor old frail man" was making the financial decisions that led to this problem as a young man. You can put in 15 years of hard work, educating yourself and making good sound intelligent decisions when it comes to finance and life in general, but you will never beat someone who emotively displays a child or "old frail person" in front of the camera.

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39 minutes ago, inbruges said:

A lot of people went on IO after the 2007/08 financial crisis, so they basically made zero provisions should things get a little tougher, and that was the way it has always been. Yet again I and many on here punished for not being stupid.

Some did.

However the big up tick was people going IO only (naked, no payment/investment) from 2002ish as housig got so expensive they could only pay the interest.

I remember chatting to a mate in 2006ish. He'd got a mortgage. He told me the APR an the monthly cost. I was trying (and failing to get the maths to work - I was coming up about ~700/m short.

It was nuts. A teaser, IO only period on a reduced APR. After 2 years the payments double.

He went bust.

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2 minutes ago, inbruges said:

"The couple’s MP, Stephen Lloyd, said: “This is a frail elderly couple who always paid their mortgage interest"

..............

 

This all you need to read and it make me sick, time and time again. This "poor old frail man" was making the financial decisions that led to this problem as a young man. You can put in 15 years of hard work, educating yourself and making good sound intelligent decisions when it comes to finance and life in general, but you will never beat someone who emotively displays a child or "old frail person" in front of the camera.

Val doesn't look too frail either, that's a compliment she  looks far younger and able to stand up for herself.

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2 minutes ago, PopGun said:

That 2nd graph indicates a good buying opportunty circa 2030..

2033. Date of the next interest rate rise?

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7 minutes ago, inbruges said:

"The couple’s MP, Stephen Lloyd, said: “This is a frail elderly couple who always paid their mortgage interest"

..............

 

This all you need to read and it make me sick, time and time again. This "poor old frail man" was making the financial decisions that led to this problem as a young man. You can put in 15 years of hard work, educating yourself and making good sound intelligent decisions when it comes to finance and life in general, but you will never beat someone who emotively displays a child or "old frail person" in front of the camera.

No. He was making a dumb decision as an old man - 60s!

 

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