Negative equity question

Thrugelmir

The_White_Horse wrote: »

nonsense. If you have an oversdraft of 1000 and you go over it, that is nothing like this example.


the bank agreed to lend you 225k. they lent you 225k. the fact the value of the house has decreased does not increase the amount you have borrowed, only the LTV which, in this example is irrlevant. Banks know that values go up and down. they agreed the mortgage at 90%. Its their tough luck it now happens to be 110%.

In your world, if house prices go up are the banks "obliged" to keep lending you more so the LTV always remains at 90%????

It's the borrowers problem if the value of the mortgage exceeds the value of the property. As any shortfall if the borrower defaults is their's to settle.

I deposit my hard earned savings in banks and wouldn't wish them to lend in a manner that took excessive risks. Risk is factored into interest charges and mortgage application costs.

Most likely paying down your mortgage would be the best use of your savings in the current market.

beecher

The_White_Horse wrote: »

well, i have been discussing with my banks. My bog standard bank (spoke to someone who didn't even understand the question) gave me a "computer says no" type answer.

My private bank seems to think that something can be arranged, and I have a meeting next week with my mortgage man.

See, if people are sensible, sensible things happen.

remember, If you're gonna ride

don't ride the white horse.

I would be pretty disgusted if banks were still taking part in irresponsible lending by setting up the sort of deal you want. I'd hazard a guess that your 'mortgage man' either misunderstood or is so bored he wants a laugh.

Generali

Don't feed the troll.

funkyfreddy9k

The_White_Horse wrote: »

My private bank seems to think that something can be arranged, and I have a meeting next week with my mortgage man.

See, if people are sensible, sensible things happen.

remember, If you're gonna ride

don't ride the white horse.

oh well. guess there are still some banks heading down the pan then - I hope they arent ones us tax payers are proping up.:mad:

silvercar

If they restructure a deal to move the negative equity part plus a bit to an unsecured loan and the mortgage part to the new home then they willbe back to the original NR together mortgages. While it may work for individuals, it won't work on a large scale, hence the computer says "no!".

Isn't the whole point of underwriting for humans to take a look at cases that the computer can't make a decision for?

Generali

Don't feed the troll.

Good night all.

PS Don't feed the troll.