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Telegraph: Bring Back 100% Mortgages--Best Way to Wealth
Comments
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HAMISH_MCTAVISH wrote: »And yet the article talks of getting one a couple of decades ago......
Well, I certainly got one in 1984.0 -
Charterhouse wrote: »That's irrelevant the risk profile is what matters. With these types of mortgage people have a much higher incentive to default all the time. The risk of default increases over time rather than decreasing. That makes them a highly exotic product and one that most lenders should not touch. You are confusing negative equity and default. NE is not a problem as long as default never occurs. But the two are wholeheartedly correlated.
Why do they have a higher incentive to default? My examples were for £50K and £100K earners.0
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