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Cash-strapped families switch £60bn-worth of mortgages to interest-only
Comments
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Yep. Im one of those on an IO/offset and it's the best mortgage we;ve ever had. We've overpaid or offset north of 100k in the last 18 months. To get a similarly advantageous savings rate (after tax) we would be needing 6-7% so it's a real no brainer and totally flexible. ie if I need that 100k back in my current account I can get it - no bother.
Of course being on an IO mortgage and all, I basically weep myself to sleep every night with the worry...
Sorry, but "Interest only/offet" is not "interest only".
And the assertion that interest only is brilliant when you're paying off capital is, well, lets say a tad cross-eyed.0 -
here you go, my first post in the thread
you do realise what that means don't you?
Post 89. That's my "discussion" with you. That's what you have been "arguing" with me about. Please read that post and reply.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
I have to say that Graham dropped one hell of a clanger with that one.
Did I?
I looked after my parents mortgage when dad was ill. They were on IO. The statements only ever detailed the amount outstanding (which were much lower than the capital remaining).
That's why I understood it as I did.0 -
Graham_Devon wrote: »The debt on a repayment mortgage is larger because you are repaying the capital aswell as the interest.
The debt on an interest only mortgage will be lower, because you are only paying the interest.
Mmmm.
Borrow £100K on repayment / Borrow £100K on IO over 25 years.
You owe the lender 100K on day 1, either way.
After 10 years, you'll owe the lender, say, £60K on the repayment, £100K on the IO.
After 25 years, you'll owe the lender £0 on the repayment, £100K on the IO.
That's how I see it you thick idiot (last three words added for authenticity).30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
Graham_Devon wrote: »I looked after my parents mortgage when dad was ill. They were on IO. The statements only ever detailed the amount outstanding (which were much lower than the capital remaining).
The amount outstanding = capital remaining.
IO or repayment makes no difference. Unless 'capital remaining' was some sort of calculation to show an LTV ratio?
EDIT: A debt is what you owe and doesn't include what it will cost to service. Two people owing £100 at 5.9% and 4.0% both have a debt of £100.0 -
I can tell you are a person who hates to be shown to be wrong. I think it makes you feel better to tell others that they are wrong, and you think you are always right. Trying to discredit shortchanged by misquoting the article was poor. I pointed that out, and you threw a slight wobbly. You are doing exactly what you accuse others of doing.
Now here's the rub. You see, I think you're right. I think chucky did make a simple mistake and now realises there are two averages being discussed. However, he is simply playing the game you play.
DervProf - "the man who always admits when he's wrong"?
You like to portray yourself as reasonable yet I have a good memory and a quick search for "admit" and "wrong" led me to the thread I was searching for.
https://forums.moneysavingexpert.com/discussion/comment/42944672#Comment_42944672
17 pages, most of it filled with you squirming to avoid the obvious.
You even disappear to "write some code".
Conclusion: you were wrong.
The closest you get to admitting it...
"Having tested out a spreadsheet mortgage calculator (and admittedly not yet being able to come up with an conclusive example of why I don't agree with the above statement) I still can't accept what RM is saying"
Translated - "I cant find a reason why I'm right but I still don't believe I'm wrong"
Touche.0 -
what he described was the NPV of a loan which is risk analysis terrain and nothing to do with a domestic mortgage or the actually home owner.The amount outstanding = capital remaining.
IO or repayment makes no difference. Unless 'capital remaining' was some sort of calculation to show an LTV ratio?
EDIT: A debt is what you owe and doesn't include what it will cost to service. Two people owing £100 at 5.9% and 4.0% both have a debt of £100.0 -
JonnyBravo wrote: »Conclusion: you were wrong.
The closest you get to admitting it...
In that particular case, I'm sure I wasn't wrong, but would be only too happy to be shown if I was. RenovationMan came up with some very strange suggestions to back up his argument. The strangest was that a repayment mortgage, where you don't pay interest, is the same as an IO mortgage. I suggested that a repayment mortgage where you don't pay interest is not a repayment mortgage.
Maybe you'd like to discuss how you came to the conclusion that I was wrong (apart from the fact that I struggled to make him see his error).
He also argued that at any one time, the interest component of a repayment mortgage will be the same as the interest on an IO mortgage. Again, I tried to point out that it depends what payments have been made, and for how long for.
RenoMan seemed to take offence that I was trying to correct him on this, and that I should have just accepted what he was saying.
He seemed to think I "had it in for him", which I didn't. My first encounter with him (which made me realise he was another chucky like character), was when he suggested that there were hundreds of inflation proof, protected capital investment products. It took a fair few posts before he came close to realising that there weren't. He even came up with a claim that he had made a certain amount of money from these products. I was genuinely interested in where he had invested his money, and he told me about a fund which didn't apper to have been going for very long. In the end, it turned out he had invested in a few funds, which I pointed out were not capital protected. We got there in the end, but it was hard work.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0
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