Friday, May 6, 2011

Sneak Peak

150,000 in negative equity at Lloyds alone

Around 150,000 homeowners who have a mortgage with Lloyds Banking Group are in negative equity, the banking giant has admitted.

Posted by richy richless @ 08:44 AM (5131 views)
Please complete the required fields.



18 thoughts on “Sneak Peak

  • It doesn’t really matter while they can make their payments and low interest rates are helping them to do this. Much higher interest rates would change this from a benign situation to a rout but it is anyones guess when this will happen. If commodity prices keep on falling, it could be quite some time.

    In the meantime, negative equity traps people in their homes which in turn reduces the transaction numbers (not that great for the HPC)

    Reply
    Please complete the required fields.



  • Thecountofnowhere says:

    These people are getting low interest rates to keep them in houses they can’t afford whilst my savings are being hammered by inflation.

    My heart bleeds.

    Reply
    Please complete the required fields.



  • sibley's b'stard child says:

    Flash, not to mention lender forebearance as encouraged by the FSA. If I recall – as per Jack – a lender has to exhaust every other option available before going down the repossession route.

    Reply
    Please complete the required fields.



  • With stocks starting to slide and commodities tanking where is an investor to go?

    Risky stocks or good old bricks and mortar appear to be the options for the safety conscious merely trying to keep pace with inflation.

    Reply
    Please complete the required fields.



  • sibs: jack? He started it!

    Joking aside, yes that is correct. This forbearance is a double edge sword because it is non too forebearing on the locked out people who are willing and able to buy the house

    Reply
    Please complete the required fields.



  • sibley's b'stard child says:

    Addendum, and then ironically the FSA criticises lenders for doing just that (in line with the ‘treating customers fairly’ charter):

    Damned if you do etc

    Reply
    Please complete the required fields.



  • nomad: I don’t recall a time when there was ever a safe place to put ones cash. The past always seems a bit more benevolent because we understand what happened and why. I’ve always been incredibly dull and risk free with my cash and it more or less worked out. However if I lived another ten lives, I’d probably have been skint in 5 of them

    Reply
    Please complete the required fields.



  • sibley's b'stard child says:

    Ah I see, poor place of wording there…

    For the avoidance of doubt, Jack is not Hector Sants.

    Reply
    Please complete the required fields.



  • Flashman, the point I’m making though not very well – is that house prices will stay high as people continue to see bricks and mortar as one of the safest bets available.

    Reply
    Please complete the required fields.



  • mark wadsworth says:

    Why is this figure of 150,000 in any way surprising? Lloyds Banking Group/HBOS appear to have (only) 24% of the mortgage market by share, so that grosses up to about 600,000 in nequity overall, i.e. about five per cent of all borrowers (the article says five per cent of Lloyds borrowers are in nequity, so that looks ‘about right’). It’s probably more at NR (as % of borrowers) and far fewer at HSBC (as % of borrowers), but hey.

    Before the DCB, it was about a million in nequity, if memory serves, which went down a lot during DCB but now that the DCB is fading, the number is drifting up again.

    Reply
    Please complete the required fields.



  • “In the meantime, negative equity traps people in their homes which in turn reduces the transaction numbers (not that great for the HPC)”

    Flash is correct, but there is a second factor that is creating an even bigger lockdown on transactions – the new higher deposits on mortgages.

    What percentage of Lloyds customers have less than 20% equity? The cost of new low deposit mortgages is so high, these people can’t contemplate moving.

    Reply
    Please complete the required fields.



  • sibs: I knew that. Just being daft

    nomad: you could well be right

    Reply
    Please complete the required fields.



  • As Sib’s points out (Friday, May 6, 2011 09:39AM) I’m not Hector Sants (but I wish I had his salary or indeed his bonus)

    To add to the comments above the other thing making life difficult at the moment is peoples inability to re-mortgage to either maintain or seek a competitive rate – there are a lot of black clouds on the horizon for heavily indebted borrowers as interest rates will inevitably rise.

    For those interested in taking a deeper look under the bonnet on arrears see recent moneymarketing article of 28/04/2011

    http://www.moneymarketing.co.uk/mortgages/high-street-will-get-caught-in-arrears-rise/1030234.article

    Reply
    Please complete the required fields.



  • jack c: I certainly never thought you were Sants but are you smugdog in a very convincing disguise? By the way, I think the mods must have nabbed him. At one stage I thought that there was a very high probability of rates rising this summer. Unfortunate things have changed very quickly and the chances have receded somewhat. In my experience things often change very quickly so a new situation might well arise that gives us our interest rate rise for reasons we were not expecting. I am a survivor of 15% mortgage rates so I would not be surprised by anything. I used to think that it would be the ‘good’ situation of a recovering economy but I’m now thinking that it is just as likely to be the ‘bad’ situation of a shrinking pool of money available for governments to borrow (that will give us our interest rate rise). Many people have forgotten that interests rates rise for some quite different reasons and controlling growth and inflation is only one of them

    Reply
    Please complete the required fields.



  • sibley's b'stard child says:

    I must admit Jack i’d never heard of Southern Pacific Mortgages, that’s rather an impressive arrears rate although not surprising given it specialises in the comically worded ‘non-conforming loans’; by the looks of things they’re still trading.

    http://www.addeva.co.uk/Mortgages/Lenders/Southern_Pacific.aspx

    Reply
    Please complete the required fields.



  • the number cruncher says:

    I do think the world is full of monopolists who are selfish. I do think there are elitist conspiracies, but not in the NWO, illumaniti smoked filed room way, Just in the georgists and rigged system way. I cannot recall accusing you personally of being either in my generalised moral rantings, if I have, and I am wrong, then I would apologise.

    Happy to handshake, but I retain my moral outlook and will continue to look at speculation in house prices and other commodities as a moral failing that needs legal suppression and firm taxation. I have a lot to learn from you, but I think you have something to learn from me as well.

    Reply
    Please complete the required fields.



  • 17. the number cruncher said…I have a lot to learn from you, but I think you have something to learn from me as well.

    ~ Success with women being one of them, I can tell. They don’t teach you that at any school.

    Sorry flasher, but it had to be said.

    Reply
    Please complete the required fields.



  • 17. the number cruncher

    You’re too nice.

    Reply
    Please complete the required fields.



Add a comment

  • Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
  • Please note that any viewpoints published here as comments are user´s views and not the views of HousePriceCrash.co.uk.
  • Please adhere to the Guidelines

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>