Used their home as a cash cow through re-mortgaging.. now in deep do do

RenovationMan

wotsthat wrote: »

Well given repo's and arrears are pretty low an evidence based assessment would be that this couple are atypical.

Even this couple could have been saved if they had been able to hang on until rates fell. In the article it stated that they were paying something like a grand more in rent than they would have paid in mortgage. After such a close shave, perhaps they would have applied themselves to OPing their mortgage and getting themselves sorted before rates went back up?

Perhaps not though because I bet their kids still go to private school.

nearlynew

The reason for the IO mortgage (as in most cases) is to allow them to move into a house they otherwise could not afford.

MRSTITTLEMOUSE

How can anyone be expected to have any sympathy for this couple.
They caused their own problems by wanting what they quite clearly could'nt afford.
Greed,sheer greed.

MRSTITTLEMOUSE

Jennifer_Jane wrote: »

Graham - nothing to do with interest-only per se, although I can see how stupid, unthinking people could get lured into not repaying it.

But, you know you have a debt (not 'you', Graham), so why, having found your dream home, wouldn't you do anything to protect it - by paying down the debt as and when you can, and saving up aggressively for an early mortgage finalisation.

Took me 9 years to pay off my house from 2000 to 2009, repaying the allowed 10% every year amongst other things. Could never have afforded this house without having an interest-only mortgage, and didn't do anything to the house in the first few years.

These people are just part of the 'Got to have it now' generation, and perhaps this down-turn will make our society less 'Because I'm worth it', and all the stronger for it.

Quite agree with what you say and it won't be before time.

faerie~spangles

£2K a month rent?

My heart bleeds...

Graham_Devon

Jennifer_Jane wrote: »

Graham - nothing to do with interest-only per se, although I can see how stupid, unthinking people could get lured into not repaying it.

I disagree. If they hadn't gone IO they wouldn't have been able to afford the house in the first place. They make that clear.

I assume, they, like so many others, only went IO as it gave them a bigger house than they could actually afford via a repayment mortgage. Trouble is, bigger house means bigger maintenance, something they clearly couldn't afford.

Remortgaging to pay for the upkeep is a symptom of the IO mortgage allowing them something they couldn't afford to run.

RenovationMan

nearlynew wrote: »

The reason for the IO mortgage (as in most cases) is to allow them to move into a house they otherwise could not afford.

Looks like this couple could afford it quite easily if they hadn't MEWed their equity (thus increasing their mortgage rate) and had their kids in state school.

I don't believe this mantra that mortgage companies allow you to borrow more money just because you're on an IO mortgage. Sorry.

quantic

It does make you wonder, we know people who appear (to everyone else) to be do so much better than us, but they have car finance up to their eye balls and an interest only mortgage... all for show these days. I'd rather sleep at night.

chalkie99

Try Googling this woman's name.

She loves the limelight

http://www.google.co.uk/search?sourceid=chrome&ie=UTF-8&q=SHONA+SIBARY

ukcarper

As people have said it’s there own fault.

“For a family with four children (Flo, 13, Annie, 11, Monty, nine, and two-year-old Dolly) living in the South-East it’s a minimum £450,000 for a four-bedroom house (we need five but I don’t want to sound fussy). Most mortgage companies won’t consider lending unless you have a deposit of 20 per cent and even then the rate isn’t that good. This, in case you haven’t figured it out, is a whopping £90,000 on a £450,000 house.”

I think the above statement show the problem I live in a 4 bed house in the south east and it’s worth about £280k of course it more modest than their previous home but I’m sure a lot of people would be very happy to live in it as I am.