Telegraph: Bring Back 100% Mortgages--Best Way to Wealth

chucky

Charterhouse wrote: »

Yes, but the point is that the house price fall that is needed to take you into negative equity is 0.01% at any point through the whole 25 year contract. Whereas after 5 years on a repayment mortgage at 75% LTV it's 25%+. So your mortgage lending becomes more and more in the money as the volatility of expected paths increases. With 100% you do not have that. The risk profile is so dramatically different that it is a miracle anyone was EVER stupid enough to do it.

have you not taken into account mortgage repayments?

Conrad

DaddyBear wrote: »

Let me think....

Unregulated lending, risky mortgages, financial collapse, recession.

99% of people do not get repossessed.

99% of people do not go bankcrupt.

Wake up

Charterhouse

chucky wrote: »

have you not taken into account mortgage repayments?

What do you think IO stands for?

Once again I realise the futility of arguing with people who don't actually understand the very things they like to get so uppity about.

Conrad

HAMISH - for some time I've been on about the fact the gap between havs and have nots will widen faster than ever, thanks to millions being frozen out of home asset ownership.

I have to trun away a far higher proportion of new enquiries now - ordinary hardworking folk that for a thousand different reasons do not fit the lending mould.

Examples would include the nurse that works for the NHS dierctly but earns another 40% on top by working for an NHS agency.

Or the black cabby mainitaing a £250k mortgage wanting to move down market and get a £150k mortgage but cannot as his net profit is too low, even though much of the profit reduction is merely a paper excercise (for example claiming for use of home to administer his buisness!)

Vince Cable is so out of touch - he keeps banging on about business lending without realising the huge impact denied ownership access will have on the wealth divide. It's largely those of middle class background that are able to enter the market. So priveledge begets priveledge.

Charterhouse

Conrad - the answer to that is lower house prices. And I say that as the owner of house just outside the London congestion charge (about 50 yards outside!), so I do not have a VI in lower house prices.

stonethrower

Conrad wrote: »

99% of people do not get repossessed.

99% of people do not go bankcrupt.

Wake up

True its 1% that do and we are made to bail them out, there is nothing wrong with 100% mortgages as long as when things go wrong the public doesn't have to bail them out.

chucky

Charterhouse wrote: »

What do you think IO stands for?

fair enough but you're talking exceptions here a tiny number of people - a 100% IO mortgage is crazy and stupid. long term over 25 years it isn't a problem but if you're looking to move you're fcuked.

Charterhouse wrote: »

Once again I realise the futility of arguing with people who don't actually understand the very things they like to get so uppity about.

lol - you're assuming 100% IO mortgages are the norm.but no-one is uppity here, just don't see that 100% interest only mortgages are the norm in the UK.

sorry to burst that bubble it's not the case

DaddyBear

nembot wrote: »

Words fail me....

Have we learn't nothing during the last ten years?

No. The ponzi must be kept going at all costs.

Nobody seems to ask why we need 100% mortgages, we didn't need them before 2003.
It's the fault of the banks that first-time buyers can't afford to get on the ladder. Damn them.

Ron2256

chucky wrote: »

that's the risk of a 100% mortgage

What price would you put on that risk? 10%? 12% IR on mortgage?

chucky

Ron2256 wrote: »

What price would you put on that risk? 10%? 12% IR on mortgage?

no idea - i don't underwrite mortgages but it shouldn't be a type of mortgage that anyone can get their hands on