Home Equity increases by 2.7% in 2011

Graham_Devon

chucknorris wrote: »

I know, it states 5% had no idea how they would repay the loan, this does not equate to 'millions' (however 78% would, hence my post).

The problem is, we simply don't know.

Some people are trying to make out everyone will have themselves sorted out. Some others are trying to suggest this won't be the case (I personally don't think it is).

Fact is, no matter how we try to paint the picture. We simply do not know.

On a personal level, I don't know how people are coming to the assumption that most people with IO mortgages and no rigid payment plan, will, on large, have sorted themselves out.

The country is in bad shape. I don't know how people are putting 2 and 2 together and coming up with the assumption that people are now prospering and shoveling money into investments in order to pay off their interest only mortgages.

I was asked for evidence. Wheres the evidence of this? I'm not going to ask for it, as it simply doesn't exist.

Put it this way. If someone asked you a quesion and you got £1,000 for being correct and the question was:

Q: Do most people with an interest only mortgage have a sufficient investment / plan to pay off their mortgage at the end of the term.

A, 1. Yes
2. No.

Which would you go for?! Theres a grand up for grabs.

chucknorris

Graham_Devon wrote: »

The problem is, we simply don't know.

Some people are trying to make out everyone will have themselves sorted out. Some others are trying to suggest this won't be the case (I personally don't think it is).

Fact is, no matter how we try to paint the picture. We simply do not know.

On a personal level, I don't know how people are coming to the assumption that most people with IO mortgages and no rigid payment plan, will, on large, have sorted themselves out.

The country is in bad shape. I don't know how people are putting 2 and 2 together and coming up with the assumption that people are now prospering and shoveling money into investments in order to pay off their interest only mortgages.

I was asked for evidence. Wheres the evidence of this? I'm not going to ask for it, as it simply doesn't exist.

Put it this way. If someone asked you a quesion and you got £1,000 for being correct and the question was:

Q: Do most people with an interest only mortgage have a sufficient investment / plan to pay off their mortgage at the end of the term.

A, 1. Yes
2. No.

Which would you go for?! Theres a grand up for grabs.

I would 'guess' yes because anyone who had the following could probably pay off their mortgage at the end of the term:

1. An endowment policy (these are interest only mortgages)
2. A pension mortgage (these are interest only mortgages)
3. An ISA mortgage (these are interest only mortgages)
4. Bought early and had already experienced years of capital growth
5. Have or will have substantial savings and/or investments
6. Future capital growth plus savings
7. Years of having a repayment mortgage but later switched to IO

By the way I'm not exactly chomping at the bit for just winning a £1,000 lol.

Graham_Devon

Right, so you appear to believe that most people on interest only mortgages have one, or a combination of the above which will allow them to pay off the mortgage, rather than having to sell the house.

Thats fair enough.

I believe thats one nice bubble to be living in.

All we can really do is leave it there, as we don't really know. All I know is the problems with IO are well documented.

chucknorris

Graham_Devon wrote: »

I believe thats one nice bubble to be living in.

I don't think its anticipating too much to expect more than 50% of IO mortgage holders to avoid end up being reposessed. I'm not saying they are all going to avoid trouble, I'm saying only a minority will end up in trouble.

Graham_Devon

chucknorris wrote: »

I don't think its anticipating too much to expect more than 50% of IO mortgage holders to avoid end up being reposessed. I'm not saying they are all going to avoid trouble, I'm saying only a minority will end up in trouble.

Sigh.

Absolutely no one is talking about them being reposessed, apart from those who wish to make out all is rosier than it seems.

Why would they be reposessed when they can simply sell up and get rid of the mortgage?

The point was, how many can pay the mortgage off. Not how many will go bankrupt or be reposessed.

RenovationMan

Graham_Devon wrote: »

Firstly I didn't promise anything. You asked me to back up my claims, and that's what I did. I chose the FSA, as I knew you would write anything else off as propoganda.

Quite why you want to write it off based on the fact it's from 2006 I don't really understand. These mortgages would have been included in your opening post.

If you want to write the above FSA findings off, then that's fine. But don't pretend it's not evidence of what I was saying, as it clearly is, and more fool you if you want to blinker past it.

No you didn't back up your claims at all. You stated that the larger proportion of IO mortgages don't have repayment vehicles.

You didn't qualify this by stating a timeframe and you also didn't say the larger proportion of IO mortgages in the year of 2006.

Your 'proof' consisted of a survey of IO mortgages taken out by 857 borrowers over a 9 month period in 2006. Are you seriously saying that this is an accurate representation of ALL current IO mortgage holders?

Really?

RenovationMan

JonnyBravo wrote: »

Presumably you disagree then?
Have you any evidence? Even 6 years old?

I'm not saying that I/O mortgages are a ticking timebomb. I side with you. It's overblown by scaremongers/pessimists/doomsayers*
I'm another with an I/O mortgage and paying more back than on a repayment schedule, but that's another argument to "what proprotion have a repayment vehicle in place?"

* Delete according to taste

I don't need to prove anything because I haven't made a statement on how many IO mortgage holders have a repayment mortgage. Devon did that and I asked for some proof as I would like to be amazed. That proof is not forthcoming, as is usually the case with Devon. He'll flip flop around the thread now and then vanish in a huge flounce if I press the point.

nearlynew

The vast majority of people who take out IO mortgages do so because it reduces the monthly payment and allows them to move into a house that they would otherwise be unable to afford.

100% guaranteed

Graham_Devon

RenovationMan wrote: »

No you didn't back up your claims at all. You stated that the larger proportion of IO mortgages don't have repayment vehicles.

You didn't qualify this by stating a timeframe and you also didn't say the larger proportion of IO mortgages in the year of 2006.

LOL.

Pathetic.

RenovationMan

Graham_Devon wrote: »

LOL.

Pathetic.

See. Flip flop.

Soooo predictable. :cool: