Friday, September 21, 2007

A look into the debt mire

Repossessions could soar in UK

No big suprise but nice to read it. Mortgage brokers said around a quarter of borrowers were in the "seriously adverse" catagory with more than six months' arrears on their mortgage, unpaid utility bills and credit cards.

Posted by ds_t @ 09:12 AM (804 views)
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8 thoughts on “A look into the debt mire

  • planning4acrash says:

    Phew, how many are in 3-months arrears? Because reposession orders can begin at that point. 1/4 6 months behind?, and rates going up? How long until the dam breaks? The only reason reposessions have not gone ballistic is because lenders think that prices will go up and that they can hold off. Once they realise that prices are going down, they will flood the auction houses. Imagine if 1/4 of all houses went under the hammer within the next 2yrs! I’ll sleep well on that thought!

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  • Excuse me, but did I read this right? Did they actually say 6 months behind? This can now only end one way.

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  • I imagine that the 1/4 of borrowers may be 1/4 of the 9% UK subprime, ie ~2% of all mortgages. Still a high percentage IMO.

    We should keep in mind that most of these are real people, given horrendous advice from banks and estate agents, about to lose thier homes.

    BTLers, on the other hand…

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  • “Imagine if 1/4 of all houses went under the hammer within the next 2yrs! I’ll sleep well on that thought!”

    To put this into context the article is talking about 1/4 of subprime mortgages.. not all mortgages.. and lets remember not all houses have a mortgage – so I think you may be a little optimistic there. I know plenty people in the 40-65 age range who are now mortgage free or will be by retirement.

    FYI I bought my first house a year ago.. not because I want to make a profit, nor BTL, but because me and my family needed somewhere to live. Period. I took a mortgage that we could afford on one wage.. and if we both work then interest rates would have to go above 15% before we need to re-evaluate things.

    I’m all for a drop in prices to help some of my freinds on the ladder, but the amount of people on here who take glee on others mis-fourtune is worrying.

    I bet most of these people are defaulting for because they lost a job, divorce or change of cicumstance and not because they fiddled the books to get a bigger mortgage than they could afford. Geez I hope it never happens to any of you.

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  • Unwise, to be fair the vast majority of comments posted on this site are in relation to the system that has saddled huge numbers of people with debt. People taking glee at the mis-fortune of others is relatively rare, limited to BTL landlords, and, generally speaking, not encouraged. The people to blame (and ridicule) are the central banks and politicians who created this damaging and unsustainable asset bubble.

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  • “Unwise”, could you give us some more information. How did you manage to buy a house with a single salary ? How much did it cost and how much do you earn, what multiple of your salary did you borrow and which part of the country are you in ?

    Enlighten us all.

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  • dohousescrashinthewoods says:

    Well said unwise. In the yearning to buy a home, some of us do forget about the human tragedy. I got a stiff dressing-down from my wife a few months back and it was well deserved.

    On the plus side, there may be a lot of pain now, but if people can financially recover, there will be new opportunities one day. However, I appreciate that some ordinary people may never recover.

    Amateur BTLs with 20 properties are looking like tasty meat for the bonfire of the vanities, though. I don’t begrudge them – I would profit if I could, but a capitalist investor who wags it in the face of those he has beaten to the prize and expects to be thanked (did anyone hear the 8:15 BTL interview on Radio 4 this morning?) can expect a touch of ill will, and if the market turns on them, they can probably expect no more grace than they were prepared to give.

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  • planning4acrash says:

    Sorry for misreading the article, I got a bit carried away!

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