100,000 homeowners 'are set to default on their mortgages'

Mrs_Bones

joe_blotts wrote: »

Many of them are on buy-to-let properties. But two-thirds of those with interest-only mortgages on their main home have only a vague notion of how they will repay the capital, or no idea at all. And 5 per cent do not even realise they have an interest-only deal.

How can people not realise if they are on an interest only deal. Surely people know what they sign up for?

Rinoa

There has been a perpetual tsunami of repossessions about to hit the housing market every year since about 2003.

Curiously, none have yet materialised. I suspect the same fate awaits this latest doomster prediction.

Thrugelmir

ukcarper wrote: »

So they would have bought in the mid 90s when house prices were less than 40% of what they are now.

Shows how much you know about Bradford & Bingley and Northern Rock's expansion .......;)

Move on a decade or so, and you would be nearer the mark

Thrugelmir

FTBFun wrote: »

100,000 properties isn't really that much in the grand scheme of things.

1% of all outstanding mortgages. Enough to move the market I would say.

ukcarper

Thrugelmir wrote: »

Shows how much you know about Bradford & Bingley and Northern Rock's expansion .......;)

Move on a decade or so, and you would be nearer the mark

Are you saying they all had 15 year mortgages.

ruggedtoast

Are there any reliable reports of forced sales when the term expires yet?

I suspect not. Banks are falling over themselves not to repo em masse and trigger a price crash, I highly doubt they are going to start with a lot of interest only schmoes at once, especially ones who are still coughing out the interest with their home as collateral.

I also doubt that many of these mortgages were underwater, you would have had to have spectacularly overpaid not to have some equity due tp hpi at the end of a normal mortgage term.

This seems like the kind of thing someone called "Desperate2crash" would post over on hpc.co.uk.

Then there would be about 10 pages of comments a minute later by a load of other regulards with UIDs like "HomeownersRscum99" and "gas_the_sheeple" all agreeing that this was about to start the mother of all crashes.

Thrugelmir

ruggedtoast wrote: »

you would have had to have spectacularly overpaid not to have some equity due tp hpi at the end of a normal mortgage term.

Many advances were the infamous 125% loans which allowed unsecured debt to be consolidated and deferred onto the never never......

HPI isn't going to be helpful given that many of these borrowers will be looking to sell.

joe_blotts

ruggedtoast wrote: »

Are there any reliable reports of forced sales when the term expires yet?

I suspect not. Banks are falling over themselves not to repo em masse and trigger a price crash, I highly doubt they are going to start with a lot of interest only schmoes at once, especially ones who are still coughing out the interest with their home as collateral.

I also doubt that many of these mortgages were underwater, you would have had to have spectacularly overpaid not to have some equity due tp hpi at the end of a normal mortgage term.

This seems like the kind of thing someone called "Desperate2crash" would post over on hpc.co.uk.

Then there would be about 10 pages of comments a minute later by a load of other regulards with UIDs like "HomeownersRscum99" and "gas_the_sheeple" all agreeing that this was about to start the mother of all crashes.

You should write books mate. All the dots connected/all the influencing effects covered and eloquent too.

RenovationMan

I have an interest only mortgage for £250k with no recognisable repayment vehicle. It was a £300k mortgage 2 years ago, also with no recognisable repayment vehicle.

somethingcorporate

RenovationMan wrote: »

I have an interest only mortgage for £250k with no recognisable repayment vehicle. It was a £300k mortgage 2 years ago, also with no recognisable repayment vehicle.

You're not a reliable sample though. Your posts are intelligent and well informed and from your signature you're obviously very clued in financially.

The people that this will impact (5% of which don't know what they've bought) are not the most financially literate out there.

Although why when someone comes to the end of their term they are badged as "defaulters" when they should be able to remortgage sounds a bit doom-mongering to me.