Home Equity increases by 2.7% in 2011

RenovationMan

nearlynew wrote: »

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

How does that work? Are you saying that mortgage providers base their lending not on salary multiples but on affordability? That'd be a lot better if they did, but it kinda blows a hole in the 3xsalary multiple so beloved by a certain sector on this board.

chucknorris

Graham_Devon wrote: »

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.

What drugs are you on? Selling up was one of items in my list i.e. capital growth (obviously allowing you to sell). Check out no.6 on my list:

6. Future capital growth plus savings

We are talking about if you can't pay off the mortgage, so the bank would repossess. Please don't tell me that your plan is to rely on the bank's generosity :rotfl:

Graham_Devon

chucknorris wrote: »

What drugs are you on? Selling up was one of items in my list i.e. capital growth (obviously allowing you to sell). Check out no.6 on my list:

6. Future capital growth plus savings

We are talking about if you can't pay off the mortgage, so the bank would repossess. Please don't tell me that your plan is to rely on the bank's generosity :rotfl:

Selling up isn't paying off the house. It's simply selling the house because you cannot buy it. It also relies on capital growth, which isn't a given. How can that be classed as a payment "vehicle"?

As for the bold bit, I'm not even sure where that has come from?

DervProf

Pimperne1 wrote: »

Actually I think he is being a bit unfair on those who are reaching the end of their repayment mortgages - they are paying off considerably more than 4% of their capital per year.

I agree, but that wasn't my point.

I was simply showing that RM's attempt at putting positive spin on Halifax's negative HPI figure for 2011 was flawed.

It might well be that mortgage holders paid off more than 4% of their capital in 2011, the truth is that RM was simply making things up.

DervProf

RenovationMan wrote: »

Are you saying that mortgage providers base their lending not on salary multiples but on affordability? That'd be a lot better if they did

So, you think that lending based on affordability is a better idea ?

I'd be interested to know what you think the criteria would or should be.

BTW. As far as I'm aware, "affordability" as well as salary are taken into consideration when a mortgage application is made (unless it's one of those "special" mortages that never, ever get granted in the UK).

chucknorris

Graham_Devon wrote: »

Selling up isn't paying off the house. It's simply selling the house because you cannot buy it. It also relies on capital growth, which isn't a given. How can that be classed as a payment "vehicle"?

It's not classed as a repayment vehicle I never said it was. You said to me:

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.

One of the above in my list was capital growth allows the mortgage to be paid off (obviously after selling). Sorry but selling and paying off the mortgage is 'paying off the mortgage'.


I can understand why others get frustrated with you on this forum now, what was your nickname? Was it Mr Muddle, seems very apt.

Graham_Devon

chucknorris wrote: »

. Sorry but selling and paying off the mortgage is 'paying off the mortgage'.

Righty-o.

You don't have the house anymore, but that's merely a minor fact.

:wall:

chucknorris

Graham_Devon wrote: »

Righty-o.

You don't have the house anymore, but that's merely a minor fact.

:wall:

Yes Graham I think you will find that when you sell the house you don't have it any more, that’s an inevitable outcome for those selling their house.

Graham_Devon

chucknorris wrote: »

Yes Graham I think you will find that when you sell the house you don't have it any more, that’s an inevitable outcome for those selling their house.

Yes, well done.

Paid off the IO mortgage. So that should shut everyone up who suggests there could be a problem paying off IO mortgages.

I was wrong. The FSA were wrong. Cleavers graph posted was also very misleading. Afterall, everyone can simply sell their own home and become mortgage free.

Maybe they could then join the mortgage free forum? Or maybe we need another section? "Mortgage and Home Free".

chucknorris

Graham_Devon wrote: »

Yes, well done.

Paid off the IO mortgage. So that should shut everyone up who suggests there could be a problem paying off IO mortgages.

I was wrong. The FSA were wrong. Cleavers graph posted was also very misleading. Afterall, everyone can simply sell their own home and become mortgage free.

Maybe they could then join the mortgage free forum? Or maybe we need another section? "Mortgage and Home Free".

You seem to be forgetting that I am not advocating this as a desired result, in realty we own 4 houses outright and have another 5 properties with an average gearing of around 50%, so very far from this proposed financial outcome. I am merely answering your simply question which was:

Put it this way. If someone asked you a question 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.

I’m not saying it’s a good plan but I would still claim my £1,000.