Defaults, demand falling, mortgage availability increasing

Graham_Devon

The rate at which mortgage holders and businesses default on loans has fallen "unexpectedly", according to the Bank of England.
The drop in the April-to-June period continues a trend seen with home loans since last year.
However, the Bank's Credit Conditions Survey said that the default rate was expected to remain unchanged in the third quarter of 2010.
Lenders warned that the rate could rise if the economic outlook worsened.
Demand The survey also found that the availability of mortgages had risen in the three months to June, compared with the previous quarter.
However, this was expected to fall back in the next three months.
Demand for new home loans fell slightly in the last three months, but the number of people wanting to remortgage had risen for the first time since the end of 2008.
Few people have been looking to remortgage in recent times, owing to the low cost of standard variable rates.

Quite a lot in there. Mortgage defaults falling (as they should do given the rates at the moment!), demand for new mortgages decreasing, mortgage availablity increasing, remortgaging increasing.

Seems all we are waiting for is the whole game to change, when interest rates rise. Certainly it all seems to be stagnating at the moment, and that's WITH a helping hand from interest rates etc.

Really2

Graham_Devon wrote: »

Quite a lot in there. Mortgage defaults falling (as they should do given the rates at the moment!), demand for new mortgages decreasing, mortgage availablity increasing, remortgaging increasing.

Seems all we are waiting for is the whole game to change, when interest rates rise. Certainly it all seems to be stagnating at the moment, and that's WITH a helping hand from interest rates etc.

Why are interest rates a helping hand? I thought most rates were not actually that far different when the base rate was near 5%.

Stagnation has been called for months now and it will be like this for years (I voted for stagnation last year and will do the next and the one after that)
You will not see a rate increase to 2%+ until things are better so this is looking like previous crashes.
Sharp nominal fall followed by real term correction.
I think you can tell by how often we all post and how many posters we now have that most are stagnating:)

Graham_Devon

Really2 wrote: »

Why are interest rates a helping hand? I thought most rates were not actually that far different when the base rate was near 5%.

Not sure I really need to answer this question?

It's helped out thousands of owners, who have seen their payments drop considerably, due to their type of mortgage.

1984ReturnsForReal_2

Graham_Devon wrote: »

Not sure I really need to answer this question?

It's helped out hundreds of thousands of owners, who have seen their payments drop considerably, due to their type of mortgage.

On the other hand defaults are only this low because people are being given payment breaks etc.

Really2

Graham_Devon wrote: »

Not sure I really need to answer this question?

It's helped out thousands of owners, who have seen their payments drop considerably, due to their type of mortgage.

Going from a fixed on SVR? So will they not be able to fix by the time rates do go up.

Anyone purchasing in the last 2 years will have similar rates to when rates where higher so saving money is hardly being helped.

I have lost count how many times I have said it rates were dropped for the sake of the economy not to help home owners.

Batchy

I was in the same boat as the reporter, I have recently realised how important it was for houseprices to be stable in this country, and how important it is to the banks, the government, and the global economy.

Now I believe its worth buying for all the benefits that go with owning (security, control, and independance), as the country will do all it can to stop armageddon happening, as its so important to the economy and the banks. The government has such a vested interest in the banks, its not going to do anything rash to bring on a huge crash, else itself will have major troubles.

I was personally so scared about inflation destroying my savings, I thought id just get in now while I could.

So, your either in it, and getting on with life, or your waiting for tin hat time, ive waited long enough, ive made good ground on LTV's and a quality house to just no longer care about prices, and what happens to them, as I dont feel the need to ever move regardless.

StevieJ

The original BOE release.

http://www.bankofengland.co.uk/publications/other/monetary/creditconditionssurvey100701.pdf

Really2

1984ReturnsForReal wrote: »

On the other hand defaults are only this low because people are being given payment breaks etc.

More than likely, my BIL jacked his job in 6 months ago. He is now in work but they had a 6 month payment break.

lemonjelly

Really2 wrote: »

Why are interest rates a helping hand? I thought most rates were not actually that far different when the base rate was near 5%.

Stagnation has been called for months now and it will be like this for years (I voted for stagnation last year and will do the next and the one after that)
You will not see a rate increase to 2%+ until things are better so this is looking like previous crashes.
Sharp nominal fall followed by real term correction.
I think you can tell by how often we all post and how many posters we now have that most are stagnating:)

We have also seen a lot of people happily chugging along on their trackers. Can't think of anyone in particular at the mo, but allow me to ponder that for a mo

People who's fixed rates have ended have slid onto the lenders SVR, which has generally been a reduction in their payments.

I really don't think we can argue that low IR's aren't helpful to mortgage payers, as invariably they do help reduce their payments, especially if the IR's stay low for a period of time.

Graham_Devon

Really2 wrote: »

I have lost count how many times I have said it rates were dropped for the sake of the economy not to help home owners.

Regardless, it's helped them! You asked me a question, I answered.

Who the poilicy was there to help is neither here nor there. Feel we could go down the route of titt for tatt here with absolutely no purpose.

1984ReturnsForReal_2

Really2 wrote: »

More than likely, my BIL jacked his job in 6 months ago. He is now in work but they had a 6 month payment break.

It's true.

It also helped (like it or not) that Labour ordered the likes of Lloyds (Cheltenham & Gloucester etc) & Northern Rock to default only as a very very last resort..