Wednesday, April 11, 2012

More abusive mortgages

Repossessions to rise as mortgage costs rocket

Brenda, 25, of Northolt continued: "I read all the brochures very carefully before signing up and all my friends told me how lucky I was. But my mortgage has been really abusive recently. At one stage I was on the verge of walking out but it said that if I did, it would hand over the keys to my flat to the bank and I'd never get back in again. It hasn't actually tried physical violence yet, but am very worried it will. I think perhaps my mortgage has got financial problems of its own, it once muttered something about having to hand over all my money to some people in The City."

Posted by mark wadsworth @ 07:41 AM (1784 views)
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6 thoughts on “More abusive mortgages

  • In 2009 I realised how naive I was signing up for a 95% Northern Rock mortgage. I ended up with around 105% LTV and trapped on ~6% apr SVR.

    I do genuine feel sorry for those who through a moment of madness in the mid 2000’s took out a huge LTV mortgage. In a way I think that is pure entrapment by the banks.

    The main issue with SVR is that you are entering into an open ended contract with the bank who will charge you as much economic rent as they can extract from you for the best part of your working life.

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  • khards – “you are entering into an open ended contract with the bank who will charge you as much economic rent as they can extract from you for the best part of your working life”

    I see this stretching to death in some cases as the lender looks to roll the mortgage onto a lifetime arrangement.

    The big question remains how long UK house prices can continue to defy gravity

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  • @jack – I suppose that all depends upon the banks. At the end of the day it’s the banks collective decision as to what house prices are since it is them who set the prices with interest rates and credit availability.

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  • mark wadsworth says:

    Khards: “In a way I think that is pure entrapment by the banks”

    Correct, the point of banks is to extract as much money from people but without them actually going bankrupt or starving to death. So they exploit Home-Owner-Ism to the hilt by pushing up house prices as high as possible, they couldn’t care less what they lend money on, as long as people keep borrowing more and more.

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  • Its funny that the rentiers / bank renters could end this simply by collectively handing back the keys on Friday afternoon.

    A collective default would also force the hand of the government to get more council houses built.

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  • Superted187 says:

    The blurb associated with the linked Metro article is not contained anywhere within the article.

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