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ollie plimsolls

15% Of 2005 Mortgages In Immediate Neg Equity

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The risky way to get it Together

Northern Rock last week revealed that in 2005 it lent an astonishing £7bn-worth of Together loans to borrowers, the vast majority of whom are likely to be first-time buyers.

That figure is all the more remarkable because the estimated total amount lent to first-time buyers by all Britain's banks, building societies and other mortgage lenders last year was around £40bn-£45bn.

So some 15% of all 2005 mortgage lending gave the borrower instant negative equity.

ollie

Edited by ollie plimsolls

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The risky way to get it Together

So some 15% of all 2005 mortgage lending gave the borrower instant negative equity.

ollie

These figures are staggering. That's a lot of FTB lending! I am surprised there has not been more comment on this.

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The Together Mortgage featured in an article in the Sunset Times this week:

http://www.timesonline.co.uk/newspaper/0,,...2024790,00.html

A bad day at Northern Rock

A family faces ruin after being told to repay money that they were told was part of their mortgage deal. By Jessica Bown

AN ADMINISTRATIVE error by Northern Rock has left Lyndsey Condie and her husband, John, with an extra debt of £18,000 they never wanted.

The Condies thought that the former building society’s Together mortgage — which allows customers to borrow up to 125% of a property’s value — would be the perfect way to clear their university debts.

But the bank’s mistake has left the family embroiled in a financial nightmare that means they are now struggling to keep their home.

The problems started when the Condies switched to a new mortgage deal, also with Northern Rock.

Lyndsey, 40, is a full-time mother who lives near Dundee with John, a 37-year-old financial analyst, and their daughters Alice, 12, and Katie, 6.

She said: “We decided to change to a tracker deal in 2003 and asked to borrow an extra £1,600 to pay for some work that needed doing on the house.

“However, in November of that year, Northern Rock paid £18,000 into our bank account. It seemed strange because we had only asked for £1,600, so we queried it with the bank. But it insisted that the money was ours to spend because we had taken out a Together plan.”

In April 2004, however, Northern Rock told the Condies that the £18,000 had been transferred into their account in error and that they would now have to pay it back.

Brian Giles of Northern Rock said: “Unfortunately, mistakes do sometimes happen. Once we realised our error, we immediately apologised to the Condies and explained that we would need to seek recovery of the full £18,000.”

Lyndsey said: “I wish the mistake had been rectified straight away, because then there wouldn’t have been a problem.

“But by the time Northern Rock told us we would have to repay the £18,000, we’d spent thousands of pounds — not on a champagne lifestyle, just on everyday things such as tyres for the car and a few extra Christmas presents for the children. The rest of the £18,000 was eaten up by our week-to-week expenses when John had to stop working because I was ill.”

The extra debt has now been added to the Condies’ mortgage. This has pushed their mortgage repayments up to a level they are finding hard to cope with. Lyndsey claims it has also plunged them into negative equity on their home — although Northern Rock disputes this.

“My husband has a good job, but we have two daughters and I’m off work and looking after the children,” Lyndsey said.

“The only real option the bank has given us is to pay off our mortgage over 33 years, instead of 15, but we don’t want to be tied to the mortgage for that long if possible.

“I feel we should be getting a preferential interest rate or some other kind of compensation because the bank made the mistake in the first place.”

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[

But by the time Northern Rock told us we would have to repay the £18,000, we’d spent thousands of pounds — not on a champagne lifestyle, just on everyday things such as tyres for the car and a few extra Christmas presents for the children. The rest of the £18,000 was eaten up by our week-to-week expenses when John had to stop working because I was ill.”

that won't cut any ice with the jury :lol:

hey! - my avatar is copyrighted don't you know ! :P

Edited by sign_of_the_times

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some analyst he proved to be :lol:

blimey - paying off uni debts at 40? :blink:

I was gobsmacked: they've spent 18K which did not belong to them and they are now complaining they have to pay it back!!. What sort of world are we living in ? Do they really believe the bank's original error justifies them treating the 18K as a freebie?

Any honest person would have immediately returned the money less the 1.6K they originally applied for.

:o:o:o:o

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Edited by Baz63

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  • 301 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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