Shortfall fears for over 1m interest only mortgage holders

Thrugelmir

GhIFA wrote: »

There is no "timebomb" - the author of the FCA report issued this week has said that is the case.

The "author" is none the wiser as to any of us as to what the future holds. The head of the FCA has previously expressed his concern. The matter is far from resolved. One only has to look at the banks to see how wrong everybody was in terms of the time and support it would take to make them stable again. As long as there's a huge consumer debt burden overhanging the UK then it's going to impact on the wider economy. So the two are linked. Which may require a painful correction to speed up the healing process.

OffGridLiving

Thrugelmir wrote: »

The "author" is none the wiser as to any of us as to what the future holds. The head of the FCA has previously expressed his concern. The matter is far from resolved. One only has to look at the banks to see how wrong everybody was in terms of the time and support it would take to make them stable again. As long as there's a huge consumer debt burden overhanging the UK then it's going to impact on the wider economy. So the two are linked. Which may require a painful correction to speed up the healing process.

Cheer up, the world will keep on turning and things will get better. I know it must seems scary at the moment, but when you get older and have been through a few recessions, you'll see that while it seems to be like the end of the world, things turn out OK in the end.

TruckerT

OffGridLiving wrote: »

Cheer up, the world will keep on turning and things will get better. I know it must seems scary at the moment, but when you get older and have been through a few recessions, you'll see that while it seems to be like the end of the world, things turn out OK in the end.

Thrugelmir is older than you think!

TruckerT

Thrugelmir

TruckerT wrote: »

Thrugelmir is older than you think!

TruckerT

Don't give my secrets away. :eek:

Thrugelmir

OffGridLiving wrote: »

Cheer up, the world will keep on turning and things will get better. I know it must seems scary at the moment, but when you get older and have been through a few recessions, you'll see that while it seems to be like the end of the world, things turn out OK in the end.

Scary? Not only do I have a wardrobe of teeshirts, but also the scars of war. Somebody has to man the ambulance and where necessary perform the surgery. Recession or no recession. People still make the same mistakes when it comes to finance. After all we all only human.

olly300

Thrugelmir wrote: »

So you expect couples to carry on working until they are 75 in order to meet the repayments ?

At the moment I know:
1. Some older people in their 70s who work doing highly skilled jobs, and
2. Some of the older cohort of baby boomers whose pensions are around the average wage or above.

People in either of those scenarios can pay a mortgage particularly if their mortgage is low.

This it will be if they haven't moved to a bigger more expensive house since 2000 and haven't mewed. (And yes again I know people in this situation.)

As I stated people can do a combination of any of the 3 options. So if they can't pay their mortgage on their own they can see if they can convince a family member to be on the mortgage and pay it. (And yes yet again I know someone who has done so.)

Cornucopia

olly300 wrote: »

People in either of those scenarios can pay a mortgage particularly if their mortgage is low.

Unfortunately, the Banks are not allowing people over their maximum ages to remortgage or extend terms. This was covered in some depth on Moneybox this week.

Although the regulator is insisting that "age is not a good guide to affordability", they have yet to convince the banks of that.

olly300

Cornucopia wrote: »

Unfortunately, the Banks are not allowing people over their maximum ages to remortgage or extend terms. This was covered in some depth on Moneybox this week.


Although the regulator is insisting that "age is not a good guide to affordability", they have yet to convince the banks of that.

I was listening to another radio station earlier in the week, which is why I posted what I did.

It was people who phoned in in their 60s who explained that a certain two mortgage providers - Santander and Halifax - were allowing them to extend their mortgages until they were 75 and giving them the other options.

I personally was a bit shocked but knowing the older folk I do and the situations they find themselves in I can understand for some older people it makes sense.

I'm with a lender that doesn't allow you to extend a mortgage pass your state retirement age. However if you are younger than 45 this retirement age is due to change come the next election.

Thrugelmir

Cornucopia wrote: »

Unfortunately, the Banks are not allowing people over their maximum ages to remortgage or extend terms. This was covered in some depth on Moneybox this week.

Although the regulator is insisting that "age is not a good guide to affordability", they have yet to convince the banks of that.

Pensions, in particular those working outside the public sector are the next big issue.

Thrugelmir

olly300 wrote: »

At the moment I know:
1. Some older people in their 70s who work doing highly skilled jobs, and
2. Some of the older cohort of baby boomers whose pensions are around the average wage or above.

People in either of those scenarios can pay a mortgage particularly if their mortgage is low.

This it will be if they haven't moved to a bigger more expensive house since 2000 and haven't mewed. (And yes again I know people in this situation.)

As I stated people can do a combination of any of the 3 options. So if they can't pay their mortgage on their own they can see if they can convince a family member to be on the mortgage and pay it. (And yes yet again I know someone who has done so.)

We all know "somebody". Unfortunately with 1 in 8 interest only mortgage holders alone apparently not even aware they would need to repay the debt . The issue is simply to large to be micro managed.